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A Commonwealth mid-year fiscal and economic outlook (MYEFO) projecting mild budget deterioration – but mostly in future fiscal years rather than the current one – means there is minimal change to the Australia Office of Financial Management (AOFM)'s funding task as laid out in its own mid-year update.
S&P Global Ratings (S&P) stayed its hand on Australia's sovereign rating following the release of the Commonwealth's mid-year economic and fiscal outlook (MYEFO) on December 19. The rating agency maintains the negative outlook on Australia's triple-A rating, while both Moody's Investors Service (Moody's) and Fitch Ratings (Fitch) are retaining stable triple-A ratings on the Australia sovereign.
On December 19, Wellington International Airport (Wellington Airport) (BBB+/S&P) disclosed that is has issued NZ$51.5 million (US$37.2 million) of 2025-maturity senior-unsecured notes as part of its latest domestic transaction. The offer - which is for up to NZ$75 million, with the ability to accept oversubscriptions of up to NZ$25 million - is set to close on February 14 2017. Additional allotment dates for the notes are scheduled for 16 January 2017, 31 January 2017 and 17 February 2017.
In the wake of its debut green transaction, Monash University (Monash) tells KangaNews the deal is a continuation of its commitment to developing an environmentally sound campus network. According to intermediaries, the US private placement (USPP) deal garnered more Australian dollar demand than usual for this format, including a major new investor.
The Australian securitisation market remained open in the penultimate week before the Christmas and new-year holiday. Commonwealth Bank of Australia printed A$2 billion (US$1.47 billion) - upsized from A$750 million - in Medallion Trust Series 2016-2. Meanwhile, Liberty Financial printed A$500 million in its third prime and nonconforming residential mortgage-backed securities deal of the year and Ecplix Group returned to the market for the first time since 2014, issuing A$330 million.
Rentenbank (AAA/Aaa/AAA) has added NZ$75 million (US$52.6 million) to its April 2024-maturity Kauri bond, a December 16 announcement revealed. According to KangaNews data, the line was introduced in April 2014 for volume of NZ$175 million and pricing of 43 basis points over mid-swap.
Liberty Financial (Liberty) printed A$500 million (US$367.7 million) in its third nonconforming residential mortgage-backed securities (RMBS) transaction of the year on December 16. Liberty Series 2016-3 has indicative volume of A$500 million (US$374.2 million) across a nine-tranche structure. The A$100 million A1a tranche and A$105 million A2 tranche priced flat to initial guidance of 75 basis points and 240 basis points over one-month bank bill swap rate (BBSW), respectively.
The latest Australian government sector borrower to announce a mid-year update to its funding task, Queensland Treasury Corporation (QTC), disclosed a requirement reduced by A$1.4 billion (US$1.05 billion) on December 14. QTC now expects to issue A$5.9 billion in 2016/17, with the reduction driven by an increase in royalty revenues compared with the June 2016/17 state budget forecasts.
On December 14, Eclipx Group (Eclipx) printed A$330 million (US$247.2 million) in its first asset-backed securities (ABS) transaction since 2014. The A$165 million class A2 tranche priced at 120 basis points over one-month bank bill swap rate (BBSW) - the tight end of initial guidance of 125-130. Final pricing on the A$31.02 million class B tranche came in at 230 basis points over one-month BBSW, against initial guidance in the low 200s area.
New South Wales Treasury Corporation confirmed an unchanged funding programme for 2016/17 in a mid-year update released on December 13. The state treasury corporation expects to issue A$4 billion (US$3 billion) of term debt in the current financial year, comprising A$4.7 billion of refinancing and a net A$700 million repayment of client term loans.
On December 16, Commonwealth Bank of Australia printed A$2 billion (US$1.47 billion) in its second residential mortgage-backed securities (RMBS) transaction of the year. The transaction was upsized from a launch volume of A$750 million. The largest, A$1.84 million A1a tranche priced at 111 basis points over one-month bank bill swap rate - the tight end of 110-113 guidance.