News
In March, Europe’s technical expert group on sustainable finance (TEG) delivered the final report on the EU’s taxonomy for climate change mitigation and adaptation. The taxonomy – and the green bond standard (GBS) that is expected to follow it – will have global ramifications for sustainable finance including opportunities and challenges for Australasian market participants.
Fitch Ratings and KangaNews have been conducting the Fixed-Income Investor Survey since the first half of 2014. The 2020 iteration combines a deeply negative outlook with vast areas of uncertainty to produce the survey’s most worrying set of data ever.
The Reserve Bank of Australia (RBA) jumped into the fog of dislocated debt capital markets in March with an unlimited government and semi-government asset purchase programme. Local investors are contemplating a cascade of market consequences.
Inflation-linked bonds could come to form a greater portion of Kāinga Ora – Homes and Communities’ funding portfolio as it provides long-term funding matched to its primary revenue stream, the issuer tells KangaNews after its debut deal in the format.
The Reserve Bank of Australia is meeting its targets for unconventional monetary policy and has begun tapering its purchases. The market appears to have avoided an adverse response so far, indicating a degree of comfort with the RBA’s policy, analysts say.
In the wake of its return to domestic issuance, Suncorp-Metway says likely volatility in the months ahead mean it is more important than ever to secure funding when the opportunity presents. The issuer became the first Australian-domiciled credit issuer to print a new bond deal since the emergence of the COVID-19 crisis, on 20 April.
New Zealand intermediaries are optimistic on market momentum but say it may still be some time before the market truly returns to normality. The tone is emerging in the wake of unprecedented volume of supply from 7-17 April as local government-sector borrowers re-entered the syndicated market.
Two more blue-chip Australian corporate borrowers have successfully printed deals in the euro market, despite not being eligible for the EU corporate-sector purchase programme (CSPP). Deal sources say euro investors are demonstrating ongoing appetite for high-quality corporate names.
Kāinga Ora – Homes and Communities has become the first New Zealand issuer without direct secondary support from the central bank to print a primary deal in New Zealand since the COVID-19 crisis began. The issuer says demand for the 17 April transaction outstripped expectations, particularly at 10-year tenor.
The Australian Office of Financial Management (AOFM)’s first syndicated deal since the beginning of the COVID-19 crisis and the consequent deluge of fiscal stimulus is a key moment in the Australian market recovery. Deal sources are confident the jumbo volume and broad-based demand signal that large transactions will be possible.
New Zealand Local Government Funding Agency is confident domestic market conditions are improving, supported by an expanded central bank asset-purchase programme. The issuer says its latest transaction is an encouraging sign the market will have capacity for increased supply from New Zealand’s semi-government borrowers.
The Australian dollar credit market has been reopened by three Canadian bank covered bond deals that priced within a week. Each deal showed signs of market development, although demand remains driven primarily by bank balance sheets as liquidity gradually improves with central bank support.