Latest News
On October 14, ME printed A$1.5 billion (US$1.1 billion) in its first residential mortgage-backed securities (RMBS) transaction of 2016. Preliminary ratings and indicative price guidance on SMHL Series Securitisation Fund 2016-1 were revealed on October 11.
In the most noteworthy activity of the week the Australian Office of Financial Management printed A$7.6 billion (US$5.76 billion) in a curve-extending new 30-year bond. Issuer and intermediaries spoke to KangaNews, citing new investor interest as one significant outcome. Meanwhile, ME printed A$1.5 billion in one of its biggest residential mortgage-backed transactions.
The Australian Office of Financial Management (AOFM) has broken volume and duration records with its latest curve-extending syndication, highlighting significant global demand for longer-dated Australian dollar product. Issuer and intermediaries note the entrance of new investors as a positive take out from the transaction and say they are optimistic around the potential for further market development in the wake of the deal.
On October 13, Colonial Holding Company (Colonial Holding) (A by S&P), Commonwealth Bank of Australia's wholly owned subsidiary, printed A$250 million (US$188 million) in a new January 2020-maturity transaction. Initial price guidance on the transaction was in the range of 120 to 125 basis points over three-month bank bill swap rate (BBSW).
The domestic senior transaction mandated by Bank of Queensland (BOQ) (A-/A3/A-) on October 12 launched and priced on October 13. The transaction priced inside nitial price guidance of 120 basis points over three-month bank bill swap rate (BBSW).
On October 13, APA Group (APA)'s (BBB/Baa2) wholly owned subsidiary, APT pipelines, printed A$200 million (US$150.8 million) in a new, seven-year domestic deal. The transaction priced in line with the minimum volume expectations and initial price guidance - of 180 basis points over semi-quarterly swap.
Province of Manitoba (Manitoba) (AA-/Aa2) has priced a A$50 million (US$37.6 million) increase to its June 2026 Kangaroo bond, an October 13 announcement revealed. The tap priced in line with indicative price guidance at 79 basis points over semi-quarterly swap.
In the wake of Chorus's inaugural offshore deal in its new guise, the issuer says the scale provided by international markets was necessary to satisfy its funding requirements. While intermediaries acknowledge that European QE dynamics may have had some effect on demand, they say solid support for Chorus was also due to the issuer's own credit story.
StockCo became the latest mid-cap issuer to complete an unrated transaction on October 13. The livestock finance group completed A$30 million (US$22.6 million) in a six-year subordinated domestic deal, with an interest rate of 8.75 per cent. According to an announcement from the transaction's sole lead, FIIG Securities, the transaction is part of a capital restructuring that will position the business to continue its rapid growth in the Australian livestock industry. The deal's completion coincides with a 30 per cent equity investment by rural security group Elders.
On October 12, the Australian Office of Financial Management (AOFM) (AAA/Aaa/AAA) printed A$7.6 billion (US$5.75 billion) in a curve-extending, 2047-maturity syndicated bond. An earlier issuer announcement revealed initial price guidance on the transaction was 100-107 basis points over the implied bid yield for the primary 10-year Treasury bond futures contract.
Rentenbank (AAA/Aaa/AAA) priced an increase to its March 2027 Kangaroo bond on October 11. According to KangaNews data, the tap issue will be the first increase to Rentenbank's longest outstanding Australian dollar line. The line was introduced on September 14 for A$100 million (US$76.1 million) at 55 basis points over semi-quarterly swap.