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KfW Bankengrupp (KfW) (AAA/Aaa/AAA) priced its third Kangaroo transaction of 2013 on March 7. The agency tapped its July 2018 bond in the deal, in a transaction which added A$400 million (US$410.9 million) to the A$1 billion it issued when it inaugurated the line in January.
Kauri market intermediaries believe the size and quantity of recent New Zealand dollar transactions from supranational, sovereign and agency (SSA) borrowers is helping to increase visibility of – and interest in – the market for both potential issuers and investors. While the bulk of Kauri buyers, especially internationally, are likely to continue their preference for frequent-borrower names, there may also be opportunities for new and returning SSAs.
On March 6 AMP Bank (A/A2) priced a new deal in the Australian market, in the issuer's first senior domestic transaction since July last year. The bank planned to issue at least A$250 million (US$257.1 million) of three-year notes but upsized the deal to a final A$500 million.
Rentenbank added to the impressive deal flow in the Kauri market in the first quarter of 2013 on March 6 with the pricing of a new September 2017 transaction. The German agency is the sixth issuer from the supranational, sovereign and agency sector to launch a Kauri deal so far this year and the pricing of its new transaction will likely take aggregate volume past the NZ$2.5 billion (US$2.1 billion) mark.
Bank of China Sydney Branch (BoC Sydney) (A) priced its second-ever Australian domestic deal on March 5, a day after mandating the offer. The issuer placed a three-year floating-rate transaction at margin of 98 basis points over bank bills, or 2 basis points tighter than its indicative margin.
On March 6 Queensland Treasury Corporation (QTC) (AA+/Aa1) priced a syndicated increase to its July 2024 benchmark bond, having upsized the issue to A$750 million (US$771.9 million) from an indicative A$500 million at launch the previous day. According to QTC data, the line in question had by March 1 already grown to A$3.3 billion through tenders subsequent to the A$1 billion it issued in the original bookbuild.
On March 5 Kommunalbanken Norway (KBN) (AAA/Aaa/AAA) priced a tap of its July 2022 Kangaroo line. The line to be increased was inaugurated by KBN in July last year in a A$200 million (US$204.1 million) transaction and has been increased twice previously, most recently in January this year, to total A$450 million ahead of pricing on the new deal.
A residential mortgage-backed securities (RMBS) issued by Origin Mortgage Management Services (Origin MMS) – a subsidiary of Columbus Capital (Columbus) previously owned by ANZ Banking Group – priced on March 4. The deal, Triton Trust No.2 Bond Series 2013-1, matched its indicative volume of A$500 million (US$506.2 million) across its four tranches.
National Bank of Abu Dhabi (NBAD), which debuted as a Kangaroo issuer on February 28, says engagement with domestic investors is key to the diversification it hopes to achieve by becoming a repeat borrower in the Australian market. The bank had been looking at the Kangaroo market for two years prior to issuing its first deal, waiting until it was comfortable it would achieve at least 50 per cent take up from local buyers in its debut.
Diversity was the key theme of Australasian issuance in the past week, with notable transactions including corporate deal flow in Australia and New Zealand and a rare Middle Eastern-issuer Kangaroo. Supply volume remained limited, however, with just a smattering of small high-grade transactions in Australia and no other primary market movement in New Zealand.