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On 2 July, Toronto-Dominion Bank (TD Bank) (AA-/Aa1) revealed plans for a new, five-year, Australian dollar denominated senior Kangaroo benchmark transaction, offered in either or both fixed- and floating-rate formats. ANZ, Commonwealth Bank of Australia, DBS Bank, National Australia Bank, Standard Chartered, TD Securities and Westpac Institutional Bank have been mandated for the transaction, which is expected to launch in the near future. The deal is bail-inable and is expected to be rated Aa3/A.
On 18 June, the EU technical expert group (TEG) subgroup on taxonomy published the Taxonomy Technical Report. The taxonomy is expected to become the world’s foremost roadmap for sustainable investment, with a key definitional role in the green-bond market.
On 1 July, Trustpower (NR) launched a NZ$100-125 million (US$67.2-84 million) senior-unsecured, seven-year deal to New Zealand institutional and retail investors. The forthcoming deal has an indicative margin range of 175-185 basis points over mid swap, with final margin and interest rate to be set on 5 July following a bookbuild. Deutsche Craigs and Forsyth Barr are joint lead managers.
On 1 July, Metro Finance launched its auto and equipment asset-backed securities (ABS) deal, Metro 2019-1 Trust. The deal has indicative volume of A$300 million (US$210.7 million) with the potential to upsize to A$400 million. Pricing is expected on or before 4 July, according to arranger National Australia Bank.
On 1 July, Auckland Council (AA/Aa2) launched its new, six-year, NZ$100-150 million (US$67.2-100.8 million) green-bond transaction. The forthcoming deal has indicative price guidance of 55-59 basis points over mid swap, with the final margin to be set on 3 July following a bookbuild. ANZ and BNZ are joint lead managers.
The final week of June was highlighted by New South Wales Treasury Corporation's A$2 billion (US$1.4 billion) syndicated tap of its April 2029 line, and Standard Chartered's A$1 billion six-year non-call five-year debut Kangaroo deal. In New Zealand, Auckland Council indicated its intention to consult investors on a new green bond in the first week of July.
Bank balance sheets doubled their participation in New South Wales Treasury Corporation (TCorp)’s latest syndication. Market participants say this is no surprise given a recent tweak to Australia's liquid-assets regime for major banks – adding that the changes should drive further incremental bank demand to local high-grade issuers.
Standard Chartered priced its debut Kangaroo transaction on 25 June, with a A$1 billion (US$700.1 million) deal eligible for minimum requirement for own funds and eligible liabilities (MREL). Deal sources say the Kangaroo format is becoming a reliable means for global financial institutions (FIs) to gain domestic investor penetration with total loss-absorbing capacity (TLAC)-eligible deals.
S&P Global Ratings (S&P) published a report on 26 June, positing that the Reserve Bank of New Zealand (RBNZ)’s proposed increase to bank-capital requirements will have minimal effect on the availability of credit in New Zealand, based on capital requirements stipulated by Australian Prudential Regulation Authority (APRA).