News
In early December 2017, for the second year running, KangaNews invited debt strategists from the best-performing houses in its mid-year Fixed-Income Research Poll to a roundtable discussion to look at the year passed and to come. In a wide-ranging conversation, strategists share views on international and domestic market conditions, rates and yield directions and why inflation is the missing piece in the global recovery.
On 21 December, South Australian Government Financing Authority (SAFA) revised down its gross-funding requirement by A$1.2 billion (US$919.2 million) for the 2017/18 financial year. Following the South Australian mid-year budget review, SAFA’s revised funding programme is A$3.6 billion.
On 19 December, Queensland Treasury Corporation (QTC) revealed its term-funding programme for 2017/18 has been increased by A$200 million (US$153.4 million) following the Queensland government’s mid-year fiscal and economic review. The increase brings QTC’s total requirement for the year to A$7 billion, of which the treasury corporation confirms it has already raised A$6 billion.
In the wake of a 25-year domestic deal for University of Melbourne, issuer and intermediary suggest the Australian market could provide a feasible alternative for issuers that regularly access the US private placement (USPP) market for longer tenor. They also say that although the deal’s size was modest, the potential investor base is larger than this transaction uncovered.
The prominence of the residential sector within Australia’s economy and financial markets makes the mortgage a fascinating prospect for sustainable investment evolution. At the Australian Securitisation Forum’s annual conference on 21 November, two market participants closely connected with the development of the local sustainable debt market discussed the prospects for investable green mortgages.
Treasury Corporation of Victoria (TCV) lowered its funding requirement for the remainder of the 2017/18 fiscal year, following Victoria’s mid-year budget update. Even so, TCV still needs to raise an additional A$2.5-3 billion (US$1.9-2.3 billion) before the end of June 2018.
The Australian Office of Financial Management (AOFM) completed the ninth auction under its programme to divest its remaining holdings of residential mortgage-backed securities (RMBS) on 14 December. A total cash value of A$439.24 million (US$336.87 million) of RMBS was sold across five lines originally issued by Suncorp Group, Bank of Queensland and Firstmac, representing 100 per cent of the securities on offer.
New South Wales Treasury Corporation (TCorp’s) term-funding requirement for 2017/18 remained unchanged following the New South Wales government’s half-yearly review, TCorp revealed on 14 December. Net new client loans and projected term maturities are also in line with the state budget in June.
In conjunction with the half-year economic and fiscal update (HYEFU) 2017, the New Zealand Debt Management Office (NZDMO) revealed in a New Zealand government bond (NZGB) programme update released on 14 December that its 2017/18 programme will remain unchanged from that published in its previous programme update, in August this year.
South Australian Government Financing Authority (SAFA) garnered a two-and-a-half times oversubscription in its fourth syndicated transaction of calendar year 2017. The issuer tells KangaNews this outcome reflects several market-driven factors as well as its own unique approach to syndication.
The ability of Vodafone Group (Vodafone) to execute a sizeable Australian dollar transaction in short order and close to the end of a calendar year is testament to the further development of the local market, buy-side sources and intermediaries agree. The enhanced status of the Australian market is only emphasised by the issuer’s ability to print in scale without specific local premarketing.
L-Bank printed a new mid-curve Kangaroo transaction for the first time in more than a year on 8 December. In the wake of this deal, L-Bank’s Karlsruhe-based international funding officer, Sven Lautenschläger, tells KangaNews the deal is another step in the agency’s strategic plan to bolster its curve and enhance liquidity in its outstanding Australian dollar lines.