News
New South Wales Treasury Corporation (TCorp) priced a A$1.75 billion (US$1.2 billion) transaction in the mid-curve on 5 September, which the issuer says is indicative of its intention to issue across the curve having printed A$2 billion of 2029 maturity notes in June and A$1.25 billion of 2031s in July.
Latitude Finance Australia (Latitude) upsized its most recent master-trust asset-backed securities (ABS) transaction on the back of demand that was especially supportive for lower-rated notes, the issuer says. Its next goal is further to diversity its investor base, a task it hopes will be assisted by the increasing breadth of the Australian dollar securitisation market.
Commonwealth Bank of Australia (CommBank) printed its first tier-two capital deal since the confirmation of Australian total loss-absorbing capital (TLAC) requirements in the form of a US dollar deal priced on 5 September. CommBank is the last of the major banks to make a start on upsizing its tier-two stack but the issuer says it is well set to manage the task.
Declining interest rates and the global hunt for yield has opened pricing opportunities for offshore financial institutions (FIs) to issue Australian dollar additional tier-one (AT1) instruments for the first time in more than a decade. UBS Group (UBS), BNP Paribas and Societe Generale have all printed AT1 deals in Australian dollars since July.
The securitisation of a pool consisting solely of nonresident mortgages priced by Columbus Capital (Columbus) on 30 September is a world-first deal of this type, its arranger says. Assuaging investor and ratings agency concerns on cross-border risk was key to getting the deal off the ground, while the transaction’s success makes issuer and arranger confident there is a robust market for the product.
The Australian Prudential Regulation Authority (APRA) determined on 9 July that Australia’s major banks will need to increase their capital ratios by 3 per cent of risk-weighted assets (RWAs) by 2024 to satisfy total loss-absorbing capacity (TLAC) equivalent requirements. How and where the major banks raise the capital will have ripple effects in the market.
Bendigo and Adelaide Bank (BEN) focused on price discipline in its latest deal through more challenging market conditions. The issuer says investor support remained robust, allowing it to meet its volume target without having to reassess its pricing goals.
Resimac says demand fundamentals remained sound for its return to prime residential mortgage-backed securities (RMBS) issuance via the Premier programme. The issuer highlights changing global demand patterns, however, and says it is prepared for more challenging funding conditions should they emerge.
The inaugural asset-backed securities (ABS) transaction from Zipmoney (Zip) is – according to the deal’s arranger – the world’s first-ever master trust securitisation of buy-now-pay-later (BNPL) receivables. The issuer says establishing the funding vehicle will provide it with flexibility and efficiency to support continued growth and that the debut deal was well received by investors hungry for diversified, high-yielding product.
While on a trip to the antipodes, PGIM’s chief investment strategist and head of global bonds, Robert Tipp, spoke to KangaNews about the realities of the low-rate environment and fixed-income investment strategy amid negative headlines and challenging market conditions.
Favourable domestic market conditions and strong investor support enabled ANZ Banking Group (ANZ) to print its second senior-unsecured deal in the Australian market for the year. The deal is the 10th ever senior-unsecured major-bank benchmark of A$3 billion (US$2 billion), four of which have printed in 2019 and eight since the start of last year.
An ongoing supportive market and a desire for a smooth tier-two maturity profile drove Westpac Banking Corporation (Westpac) to undertake its second tier-two deal since total capital requirements for Australia’s major banks were raised in July. Westpac’s domestic dollar foray continued the theme of strong oversubscription and price tightening for major-bank tier-two product.