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The announcement in early April of a massive programme of quantitative easing by the Bank of Japan (BoJ) is expected to suppress local bond yields even further and consequently force Japanese funds into international investments. But Japanese market watchers say that move has yet to begin, and the falling yen continues to cause repatriation of assets.
GE Capital Australia Funding (GE Capital) (AA+/A1) priced a new November 2016 maturity domestic transaction on May 2, in what was the issuer's third visit to the Australian market this year. GE Capital placed a total of A$750 million (US$770.7 million) in a five-year fixed- and floating-rate deal in January, then added A$200 million in a 2022 maturity fixed-rate note in March.
On May 2, IMB priced its first securitisation issue since 2011, following disclosure of expected ratings on the bank's Illawarra Series 2013-1 Trust residential mortgage-backed securities (RMBS) transaction on April 29.
With a third of the year over ANZ has so far maintained its recent record as the leading intermediary in the Australian and New Zealand bond markets. According to KangaNews's league tables, ANZ lead managed more deal volume in 2013 to the end of April than any other bank when issuance from domestic and international borrowers is taken into account.
Half year results released by ANZ Banking Group (ANZ) on April 30 show an increasing gap between the bank's cost of deposit funding and wholesale margins, with the bank paying around 50 basis points more for deposits than for three-year wholesale debt by the end of March this year. Overall, ANZ's funding mix remained largely stable compared with six months previously.
The sole lead manager on the recent return to Australian dollar issuance by Qantas Airways (Qantas) says the issuer's first domestic market deal for 10 years was based on demand for the issuer's credit among a small group of investors. However, the response to the transaction – including post-deal feedback – suggests the airline could find appetite for a more widely-distributed deal.
Another holiday week in Australia and New Zealand kept deal flow suppressed, with only four transactions priced. The most significant deal, which also opened the week, was Qantas's return to the domestic market with its first transaction in a decade.
Australian Rail Track Corporation (ARTC) (Aa2) priced a new three-year fixed and floating rate note issue in the domestic market on April 23. The new issue is ARTC's first domestic transaction since its A$100 million (US$102.66 million) tap to its 2014 floating rate note (FRN) in December 2011, which came to market shortly after the line was issued with a volume of A$200 million earlier that same month. Joint lead managers on the forthcoming deal are ANZ and Commonwealth Bank.
On April 23, Asian Development Bank (ADB) (AAA/Aaa/AAA) priced an increase of its July 2017 Kauri line. The tap is the second increase to the line, which was introduced in July 2012 at a volume of NZ$250 million (US$209.7 million) with pricing of 56.2 basis points over New Zealand government bonds (NZGB). The line saw its first tap in January 2013, when ADB added NZ$400 million at 58.7 basis points over NZGB.