News
This year has been a landmark for the adoption of alternative reference rates (ARR) in the Australian market and South Australian Government Financing Authority (SAFA)’s second deal linked to the Australian Overnight Index Average (AONIA) has capped it off. The issuer says engagement in the Australian market has reached a new level of maturity.
Investor diversity was front of mind recently for National Australia Bank (NAB) with two esoteric capital transactions in as many days. The major banks face increased capital requirements and NAB says developing new avenues to achieve funding and investor diversity is crucial.
On December 5, the Reserve Bank of New Zealand (RBNZ) revealed its final determination on new capital requirements for domestic banks. Banks will still have higher capital requirements but the regulator has elected to let them fund part of these with redeemable additional tier-one (AT1) instruments and is also granting a longer implementation period.
KangaNews is proud to present the winners of the institutional and deal categories in the KangaNews Awards 2019. After an extensive voting and verification process, KangaNews can confidently say its results reflect a true market view on the outstanding performers of 2019 in the Australian and New Zealand debt markets.
Cleanaway Waste Management priced the tightest deal from an unrated Australian industrial issuer in the USPP market since the financial crisis with its recent transaction, placement agents say. The issuer undertook the deal to term out bank debt it took on following an acquisition in 2018 and it says further expansion is on the horizon.
Financial institution (FI) issuance has been a laggard even as Australian dollar green, social and sustainability (GSS) bond issuance volume has nearly doubled in 2019. However, following its second sustainability bond print, Bank Australia says engagement with the asset class continues to grow as sustainability and responsible banking issues hit home with investors and customers.
National Housing Finance and Investment Corporation (NHFIC) targeted development of its investor base in it second bond transaction, which priced on 19 November. Issuance volume is limited by NHFIC’s clients’ need but the issuer says it has a pipeline to provide liquidity for investors.
Flexigroup says including green tranches all the way down the capital stack of its latest asset-backed securities (ABS) transaction was the best deployment of qualifying assets. The issuer says ‘dark-green’ investors remain thin on the ground in ABS transactions but it still benefited from its innovation in the green-bond space.
Commonwealth Bank of Australia (CommBank) believes it achieved all the objectives it set for its issuance of the first residential mortgage-backed securities (RMBS) deal to use the Australian overnight index average (AONIA) reference rate. The bank wanted to respond to regulatory guidance from the Reserve Bank of Australia (RBA) with a broadly distributed benchmark transaction that also provided capital relief.
The return of 10-year issuance opportunities in the Australian corporate market brought another household name – Qantas Airways (Qantas) – to market on 20 November. Transaction sources say the deal had broad support domestically and abroad, and also featured a landmark for retail investor involvement in domestic debt-capital markets.
As a growing group of borrowers become seasoned issuers in the green, social and sustainability (GSS) bond market, participants’ attention is increasingly turning to ongoing reporting on use of proceeds and sustainable assets. New South Wales Treasury Corporation (TCorp) took a lead position on reporting in October and followed a few weeks later with a second GSS bond.
Alessandro Pagani, head of the mortgage and structured finance team at Loomis Sayles in Boston, visited Australia in November to discuss the global securitisation market with local investors and to get an update on Australian structured finance. KangaNews sat down with Pagani to hear about the securitisation asset class in a challenging investment environment, the appeal of Australian assets and the challenges of developing a broader collateral base for this market.