AOFM keeps ABSF on hold
The Australian Office of Financial Management (AOFM) revealed on 8 July that the pause on inviting investment proposals for its Australian Business Securitisation Fund (ABSF) will remain in place for the time being. It says the fund was designed “as primarily an exercise in market development” but the process of achieving this development is on hiatus and therefore the AOFM will not progress with further ABSF investments.
Australian corporate market poised and hopeful for a smoother second half
The Australian dollar corporate debt market finished the first half of 2020 with a flurry of deals and greatly improved sentiment. Corporate originators do not expect the floodgates of issuance to open in the second half but say conditions should be supportive for active issuers.
AOFM gives guidance for 2020/21 borrowing, including 2051 syndication
On 3 July, the Australian Office of Financial Management (AOFM) gave issuance guidance for the 2020/21 financial year, which will apply until the Federal government budget is handed down in October 2020. There is no formal overall volume stipulated, but the AOFM expects to continue to tender Treasury bonds at a rate of A$4-5 billion (US$2.8-3.5 billion) most weeks.
Anchored three-year yield spurs ASX to introduce five-year futures
Increased issuance from the AOFM – including targeting maturities of 3-5 and 10-12 years – and the Reserve Bank of Australia (RBA)’s intervention in the Australian sovereign bond market have accelerated Australian Securities Exchange (ASX) thinking about a new contract in its bond futures suite. The exchange is planning to introduce a new five-year contract by the end of the year.
Bluestone the latest borrower to benefit from securitisation support
Bluestone Group continued the steady flow of securitisation deals coming to market with a new residential mortgage-backed securities (RMBS) deal on 30 June. The borrower says government intervention paved its path to market and is allowing the nonbank lender to continue originating and securitising prime and near-prime mortgages.