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On March 1 Bank of China Sydney Branch (BoC Sydney) (A/A1/A) became the fifth Asian borrower to price an Australian dollar transaction in 2012 and the second Chinese bank to do so via a domestic branch. Oversea-Chinese Banking Corporation (AA-/Aa1/A+) priced its second-ever Australian dollar deal, a A$600 million (US$648.6 million) three-year floating rate note, on February 23.
Nordic Investment Bank (NIB) (AAA/Aaa) priced a new five-year Kauri deal on March 1 in a transaction that makes the supranational the second largest borrower in the Kauri market by issued volume. NIB has placed NZ$1.5 billion (US$1.3 billion) of Kauris following the new transaction's pricing,  NZ$100 million more than the third largest issuer in the market, International Finance Corporation.
KfW Bankengruppe (KfW) (AAA/Aaa/AAA) priced its fourth Kangaroo transaction of the year on February 29, increasing its March 2017 line by A$350 million (US$378.3 million) to A$2.4 billion. KfW had already placed A$1.15 billion of Kangaroos in three 2012 issues, matching the total number of deals placed by all other supranational, sovereign and agency (SSA) borrowers combined.
The reorganisation of Royal Bank of Scotland (RBS)'s fixed income, currencies and commodities (FICC) business that will see much of the bank's FICC trading operation in Sydney either closed or relocated will not affect the local origination and syndicate business, a bank source says. RBS Australia will continue to have a Sydney-based presence in debt capital markets and securitisation origination and is maintaining its local syndicate.
The completion of an exchange offer for subordinated debt issued by Royal Bank of Scotland (RBS) (A-/A3/A), but which the bank is prohibited from calling, has seen just under A$1.1 billion (US$1.2 billion) of domestic paper replaced with new RBS sub debt. The total outstanding in the four locally-issued tranches subject to the exchange offer in advance of its March 9 completion was A$1.9 billion.
AGL Energy (AGL) (BBB) set the margin on its retail hybrid offer on March 7, finalising offer volume at A$650 million (US$686.7 million) in a security with a seven-year term to redemption date. The issuer widened the offer margin from an indicative 340-360 basis points over bank bill swap rate (BBSW) to 380 basis points over BBSW.
Although the new benchmark A$1 billion (US$1.1 billion) deal priced on February 28 by New South Wales Treasury Corporation (TCorp) (AAA/Aaa) has a very close maturity date to an existing Commonwealth-guaranteed line issued by the state treasury corporation, TCorp says the new issue was not primarily aimed at reducing its outstanding Commonwealth-guaranteed volume.
World Bank marked its return to the Kangaroo market after a year-long absence with a higher proportion of domestic demand in the shorter-dated of the two tranches than has generally been the case in Kangaroos in 2012. The issuer says it was pleased to achieve the volume of demand – A$1.05 billion (US$1.1 billion) in total – the transaction attracted, which enabled an upsize of A$450 million across both tranches.

Australian deal flow has remained subdued although issuance came from a number of sectors, including a syndicated Commonwealth government inflation-linked issue and the return of an Asian bank to the domestic market via its Sydney branch. In ratings actions, Fitch Ratings downgraded three of the Australian majors to equalise all the big four ratings at AA- stable.

Overseas Chinese Banking Corporation Sydney Branch (OCBC Sydney) (AA-/Aa1/A+) priced its second Australian market transaction on February 23. The deal follows a domestic debut from July last year, in which OCBC Sydney priced A$500 million (US$532.3 million) of three-year floating rate notes at a margin of 83 basis points over bank bill swap rate.