News

European Investment Bank (EIB)'s (AAA/Aaa/AAA) outstanding Kauri market volume has passed the NZ$1 billion (US$698.4 million) mark with the February 4 pricing of the issuer's new NZ$200 million February 2013 line. The deal also marks EIB's return to the Kauri market after a long hiatus – its last New Zealand transaction came in March 2008.

After a record January the Kangaroo market shows no signs of slowing in the second month of 2010 with KfW Bankengruppe (KfW) (AAA/Aaa/AAA) pricing a A$350 million (US$303.14 million) minimum increase to its December 2019 line on February 5, taking total Kangaroo issuance in February to A$1.85 billion in less than a week.

The second Kauri deal of 2010 priced on February 3, with World Bank (AAA/Aaa) adding NZ$300 million (US$213.12 million) to its December 2014 bond a day after launching the transaction. On the same day another Kauri transaction launched as European Investment Bank (EIB) (AAA/Aaa/AAA) announced the forthcoming pricing of a new three-year line.

ANZ (AA/Aa1) completed its first Samurai deal of 2010 – the second from an Australian issuer – on February 3, pricing a total of ¥60.3 billion (US$666.67 million) in a five-year, predominantly fixed-rate offering. Pricing on the transaction came in the middle of the indicative range given by the issuer, and was exactly in line with the levels achieved by Westpac Banking Corporation (Westpac) (AA/Aa1/AA-) in the equivalent tranches of its January 15 Samurai.

On the same day as it priced an increase to its December 2014 Kauri bond, World Bank (AAA/Aaa) priced A$1.5 billion (US$1.33 billion) in its new five-year benchmark Kangaroo transaction via ANZ, RBC Capital Markets and TD Securities. The transaction equals the volume of both the largest-ever supranational, sovereign and agency (SSA) Kangaroo deal and the largest single Kangaroo tranche from any issuer.

A half-yearly funding update released by New South Wales Treasury Corporation (TCorp)'s (AAA/Aaa) on February 1 flags a likely increase in the expected volume of funds raised by inflation-linked issuance for the 2009/10 financial year. And while TCorp does not commit to further government-guaranteed funding the update also restates the positive impact on demand for the state treasury corporation's debt created by the guarantee.

On January 28, Kommunalbanken Norway (KBN) (AAA/Aaa) opened a new February 2013 Kangaroo maturity, pricing A$350 million (US$315.5 million) of floating rate notes (FRN) at 43 basis points over the three month bank bill swap rate. The transaction has pushed total Kangaroo issuance for January into record setting territory at A$6.325 billion – a volume that surpasses the old high-water mark of A$6.3 billion seen in February 2007.

The firms set to benefit from the Australian Office of Financial Management (AOFM)'s serial investments in residential mortgage-backed securities (RMBS) programme include two from the banking sector as well as three non-bank names. The government debt management agency will inject a total of up to A$3.4 billion (US$3.06 billion) into a series of RMBS deals from the five firms.

In a late finish to activity on January 27, Rentenbank (AAA/Aaa/AAA) tapped its January 2013 Kangaroo floating rate note (FRN) by A$350 million (US$313.18 million) long after the close of business. The increase brings the outstanding size of Rentenbank's FRN – which was first brought to market on January 14 this year – to A$650 million and aggregate Kangaroo issuance for the month to A$5.975 billion.

The state development bank of North-Rhine Westphalia (NRW), NRW.BANK (AA-/Aa1/AAA) – which has A$300 million (US$271.65 million) outstanding in its only Kangaroo line – has announced a change in ownership structure which will bind bank and state more closely together. The state has increased its equity share to 98.9 per cent from 64.74 per cent while the shares of the Regional Associations of the Rhineland and Westphalia-Lippe have dropped to 0.7 percent each from 17.63 percent.

Inter-American Development Bank (IADB) (AAA/Aaa/AAA) priced its third Kangaroo deal of the month on January 22, selling A$500 million (US$451.15 million) in a new May 2013 line at 60 basis points over government bonds or 15 basis points over swap. Having already issued A$900 million of Kangaroo paper this year – both of them increases to existing lines – IADB's new deal makes it the biggest Kangaroo issuer of 2010.

Lead managers on the first Australian residential mortgage-backed security (RMBS) issue of 2010 – AMP Bank's A$1 billion (US$902.8 million) Progress Trust 2010-1 (Progress 2010-1) transaction that priced on January 22 – say the market has picked up where it left off late last year in terms of returning confidence. A healthy pipeline of deals is predicted, as well as the return of offshore currency issuance by Australian firms.