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On October 4 P&N Bank priced its first residential mortgage-backed securities (RMBS) transaction since November 2010 – when the bank operated under the name Police & Nurses Credit Society. P&N's Pinnacle Series Trust 2013-T1 RMBS – a securitisation of prime residential mortgages - has a total volume of A$300 million (US$282.6 million) across four tranches.
Only a handful of deals price in the Australian market in the first week of October, with activity at a standstill on the other side of the Tasman Sea. Mirvac Group Finance returned to the AUD market with a new seven-year line alongside predictions of a ramp-up in activity for the corporate bond market. Meanwhile, ME Bank's new A$1.25 billion (US$1.17 billion) line continued a run of substancial Australian residential mortgage-backed securities deals.
Lead managers on the October 3 return to domestic issuance by Mirvac Group Finance (Mirvac) predict a busy period ahead for the corporate bond issuance market. Mirvac's curve-extending, A$200 million (US$188.2 million) transaction was the issuer's first domestic deal of the year and the first Australian dollar issue from an investment-grade corporate name since Stockland Trust Management's new 2019 priced on August 30.
Relative pricing and globally-conducive market conditions combined in September to allow Australian corporate issuers to execute on planned funding diversification strategies. European markets in particular proved to be a focal point for issuance, with issuers and intermediaries saying market tone has been sufficiently positive to allow borrowers to place deals wherever their funding needs can best be matched.
A new residential mortgage-backed securities (RMBS) transaction from ME Bank, its first in 2013, priced on October 3. The transaction reached a volume of A$1.25 billion (US$1.17 billion) across four tranches.
On October 3, Metropolitan Life Global Funding I (Metlife) (AA-/Aa3/AA) priced a new five-year benchmark Kangaroo transaction. It is the borrower's second Kangaroo deal after a A$500 million (US$468.4 million) five-year priced in September 2012, at 217.5 basis points over Australian government bond.
The New Zealand Debt Management Office (NZDMO) has appointed Deutsche Bank, HSBC and Westpac New Zealand as the lead managers for a new September 2030 inflation-linked bond it plans to issue before the end of November this year. The NZDMO disclosed the makeup of the syndicate on October 2, also revealing it expects to issue NZ$1-2 billion (US$825.8 million – 1.65 billion) in the new bond's debut.
At its October meeting, the Reserve Bank of Australia (RBA) elected to keep the cash rate at 2.5 per cent – a move predicted by all 33 economists in a Bloomberg survey ahead of the announcement. HSBC data says markets were also convinced of a hold decision in advance, with this being 95 per cent priced in.
Ongoing attractive market conditions drew Westpac Banking Corporation (Westpac) back to the residential mortgage-backed securities (RMBS) market for the second time this year on September 27. The bank's A$2.25 billion (US$2.10 billion) deal continued a run of substantial deal prints and distribution weighting towards bank balance sheet participation.
On October 1, Investec Bank Australia (Investec Australia) announced an offer to buy back the outstanding balance of its December 2014 maturity government-guaranteed bond line. The line in question has A$116 million (US$108.1 million) remaining on issue, having already been reduced from the A$450 million originally priced in November 2009.
A new asset-backed securities (ABS) transaction from Macquarie leasing, its first all-AUD issue of the year, priced on September 27. The transaction matched its launch volume of A$500 million (US$464.8 million) across three tranches.