Online articles

• Australian securitisers ready to withstand asset challenges

  Australian mortgage lenders say their books – and the securitisation and covered-bond structures they use to fund them – are of sufficient quality to withstand growing pressure on loan serviceability as rates continue to rise and cost of living challenges grow. Speakers at an Australian Securitisation Forum investor briefing in London noted solid prepayment and serviceability buffers while acknowledging that...

• Australian banks cover up through ongoing volatility

  Australian banks turned defensive in Q2, printing a flurry of covered bonds as market volatility continued to dominate funding conversations. Issuers say liquidity is still readily available but tenor has shortened.

• Australian government-sector issuers hold the line despite challenges

  Australia’s largest sovereign and semi-government issuers say their funding tasks remain manageable despite difficult market conditions. Participants at the third annual KangaNews-Westpac Institutional Bank Australian high-grade roundtable discussed key issues including changing demand patterns and how different formats, such as floating-rate notes and sustainability issuance, can be used to weather higher...

• Corporate bond issuance set to spark

  Corporate borrowers have leaned on bank loans in 2022, as volatility and rising cost of funds in fixed income markets have made public bond issuance less attractive. The situation will not last indefinitely, however – indeed, corporate issuers may be forced back into funding markets in H2.

• Crest of the wave

  New Zealand is once again among the world leaders in the economic cycle, as its central bank battles with sky-high inflation through successive rate increases. The response was a key talking point at the ANZ-KangaNews New Zealand Capital Market Forum, which took place in Auckland in late May.

• Dealers hit risk limits and secondary liquidity stalls as investors eye rising yield

  Dealers across Australian dollar fixed-income markets neared or reached holding limits in Q2, further drying up liquidity that has been shallow all year. While trading volume is nearing financial crisis lows, market participants say clarity on rates and inflation could see a swift rebound – particularly in investment-grade credit – as investors hunt for bargains.

• ESG derivatives: the next sustainable finance frontier

  The pace of sustainable finance development is accelerating. Recent years have seen a surge in projects and purposes that focus on all environmental, sustainable and governance aspects and use a variety of formats and products. Derivatives play an important role in markets, but their use in sustainability has been a later addition, according to Melbourne-based King & Wood Mallesons partner, Anne-Marie Neagle,...

• Finding a new balance

  Rates are rising and markets unsettled. Speaking at ANZ and KangaNews’s annual global issuer and investor roundtable in London on 22 June, participants discussed the forces that are shaping funding in the new environment.

• First-mover advantage

  New Zealand has become a test bed for monetary policy as the country became the first in the developed world to raise rates during the latest round of tightening. Participants at the third annual KangaNews-Westpac New Zealand high-grade roundtable discussed the context of local monetary policy and the funding outlook for local government sector issuers.

• Inflation, rising rates take centre stage at KangaNews summit

  The KangaNews Debt Capital Market Summit returned to Sydney as an in-person conference in May. Discussions covered a range of topics including rising inflation, central bank policy and trading in a highly volatile market. The increasing interest in environmental, social and governance issues was another talking point.

• Is a vibrant Australian retail bond market still a pipe dream?

  The Australian retail share market is deep and liquid. So why is the retail bond market fledgling at best? Why can retail investors take ownership of parts of Australian companies with ease, yet they can barely access less risky debt investments in the same companies? Ian Paterson and Jo Dodd, partners at King & Wood Mallesons in Sydney, discuss the inconsistency behind Australia’s...

• Kāinga Ora weathers the storm

  New Zealand social housing agency Kāinga Ora – Homes and Communities is weathering a perfect storm, its Wellington-based treasurer Jason Bligh tells KangaNews, as the pandemic and inflation frustrate delivery of more than 10,000 new homes by 2024. Global appetite for sustainable debt is supporting its bond issuance, though.

• KangaNews Awards 2021: Market People of the Year

  The KangaNews Market People of the Year are the individuals who voters in the KangaNews Awards 2021 believe went above and beyond their roles to contribute to the development of the Australian and New Zealand debt markets. There are no restrictions on the firms, positions or seniority of winners – voters are simply asked to consider who contributed most to the market in either or both 2021 specifically or...

• KangaNews Awards Gala Dinner 2022

  The leading social event for the fixed-income market in Australasia, the KangaNews Awards Gala Dinner, took place in Sydney on 24 May. Guests celebrated the achievements of the winners of the KangaNews Awards in 2021. For the first time in three years, the dinner brought together participants in the Australia and New Zealand debt markets and guests from around the world. Thank you to all the guests for...

• KangaNews Fixed-Income Research Poll 2022: results announced

  KangaNews is pleased to reveal the results of its 12th annual Fixed-Income Research Poll, a survey that asks institutional investors in the Australian fixed-income market to rank the research they receive across a range of sectors.

• Mutual banks use status to confront challenges

  Mutual banks are confronting the same challenges as the rest of Australia’s lenders: higher rates leading to borrower stress, accompanied by funding volatility. Speakers at the KangaNews Mutual Sector Wholesale Funding Seminar, which took place in Sydney in June, highlighted the sector’s advantages but acknowledged its headwinds.

• Pepper’s social RMBS goals focus on platform for product development

  Australian nonbank lenders have long discussed the potential alignment of the type of lending they do with social-bond funding. As the first local issuer to bring an all-social residential mortgage-backed securities deal, Pepper Money says the value of the platform is primarily about the opportunity this type of funding offers for future development of lending product.

• Super funds warm to fixed income but mass re-weight must wait

  Superannuation funds are reassessing allocations to fixed income as rising interest rates push yield higher. While the asset class looks more attractive than it did just a few months ago, funds say it could still be a while before they meaningfully re-weight to bonds. Meanwhile, higher-yielding income asset classes may have chiselled out a permanent place in portfolios.

• The outlier

  Western Australia came through the pandemic in prime financial health, buoyed by largely positive health outcomes and surging prices in key commodities. The state’s Perth-based premier and treasurer, Mark McGowan, discusses priorities and goals.

• The road back

  Victoria’s latest state budget outlined a significant improvement in forecast state finances following the troubled environment of the pandemic. The state’s Melbourne-based treasurer, Tim Pallas, shares his view on the outlook.