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Suncorp-Metway (Suncorp) priced a new residential mortgage-backed securities (RMBS) transaction on May 10. The deal, which was upsized to A$1.15 billion (US$1.16 billion) from an indicative A$750 million, follows the April placement by Suncorp of a A$750 million senior unsecured floating-rate note, also by the Suncorp Bank entity, and A$700 million of tier two notes out of Suncorp Group.
On May 9, Hyundai Capital Services (Hyundai) (BBB+/Baa1) priced a new four-year Kangaroo deal, marking a number of firsts in the market. It is the issuer's debut Kangaroo, and also the first transaction into the Australian market in 2013 from an Asian credit borrower and from an international non-financial corporate.
On May 9, Western Australian Treasury Corporation (WATC) (AAA/Aaa) priced a new five-year floating rate note (FRN) deal. The deal is WATC's first bookbuilt transaction since its benchmark issue in November 2012 which had a volume of A$1 billion (US$1.02 billion) and pricing of 60.25 basis points over Australian government bonds.Joint lead managers on the forthcoming issue are Commonwealth Bank and National Australia Bank.
On May 9, Nederlandse Waterschapsbank (NWB) (AAA/Aaa) priced an increase to its 10-year Kangaroo issue in the first tap to the line since it was issued in April this year. This is also the first time NWB has issued more than a single Kangaroo transaction in a year sinfce 2007, according to KangaNews data.
Korea Finance Corporation (KoFC) commenced a series of Australian investor updates on May 6 as the agency attempts to make good on its intention to become a regular Kangaroo issuer. KoFC debuted in the domestic Australian dollar market in February last year, issuing a A$250 million four year in the second of 2012's flurry of Korean-origin Kangaroos.
On May 9, the Inter-American Development Bank (IADB) (AAA/Aaa/AAA) priced a new 10-year Kangaroo issue. IADB priced its previous issue on February 2013, a tap to its 2017 line, which had a volume of A$150 million (US$152.9 million) and pricing of 58.5bp over Australian government bonds.
Half-year results published by National Australia Bank (NAB) on May 9 further illustrate the rapid tightening of wholesale funding margins in recent months. However, outstanding debt issued in a higher spread environment means the NAB's average term funding cost across the portfolio has only recently stopped rising and will not fall significantly unless the current issuance environment is maintained or further improves.
On May 8, Westpac Banking Corporation (Westpac) (AA-/Aa2) priced self-led taps to two domestic issues – a dual-tranche May 2016 fixed and floating rate note (FRN) and a January 2018 FRN. The taps are the first increases of each line.
A projected return to surplus for the state government of Victoria in the 2015/16 financial year will see the funding requirement of Treasury Corporation of Victoria (TCV) fall below A$2 billion (US$2.04 billion), the corporation revealed on May 8. Analysts, ratings agencies and traders responded broadly positively to the May 7 Victorian state budget, especially the government's commitment to ongoing cost savings despite declining revenues and a challenging political position.
Bendigo and Adelaide Bank (BEN) (A-/A2/A-) priced a new four-year floating rate note (FRN) issue to the domestic market on May 8 – the bank's first domestic transaction since its three-year senior unsecured line in October 2012 and the second wholesale issue since Bendigo Bank and Adelaide Bank merged in November 2007.
J.P.Morgan Chase & Co (J.P.Morgan Chase) (A/A2/A+) priced a new five-year Kangaroo deal on May 7 in what will likely become the third Kangaroo from a US financial institution (FI) to price in 2013. Wells Fargo & Company was the first US FI to place bonds in the Australian dollar market this year, selling A$900 million (US$922.6 million) of five-year fixed- and floating-rate notes at 100 basis points over swap and bills on January 17. A week later Citigroup placed a A$500 million dual-tranche 2018 deal at 150 basis points over swap and bills.