Eased LCR requirements for offshore branch ADIs could be coming
KangaNews understands the Australian Prudential Regulation Authority could be close to changing the liquid-assets requirements for authorised deposit-taking institutions (ADIs) which are branches of offshore banks. Market sources say there are two key measures under consideration: one would likely reduce the volume of liquid assets these banks are required to hold, the other could clear the way for greater allocation to securities which do not qualify as high-quality liquid assets (HQLAs).
First wave of second-round FSI submissions shows little enthusiasm for bond options
The first release of second-round submissions to Australia's financial system inquiry reveals limited enthusiasm from market participants around the inquiry's interim report policy options concerning corporate bonds. A number of new submissions argue that easier access to retail issuance will make little difference to Australian corporate bond supply, while others reject the idea of removing dividend imputation as a way of levelling the tax playing field between equity and other asset classes.
AMP Capital flags retail fixed-income engagement as corporate fund passes A$1 billion
AMP Capital says persistent low yields have not dampened the growing appetite of Australian retail investors for credit – as demonstrated by the fund manager's Corporate Bond Fund passing A$1 billion (US$935.8 million) in funds after management early in August, four years after being made available to retail investors. AMP Capital is also confident the domestic-focused fund will see more investment opportunities in the coming months.
The wrap revival: new structure beats old school deals, but no return to the golden age
Australia could be close to seeing its first wrapped transaction since the financial crisis. While the lone survivor in the Australian wrapper space – Assured Guaranty – claims the monoline wrap product can play a valuable role, domestic institutional investors say the rebirth will, at best, be gradual.
WA downgraded to Aa1 by Moody's on doubts around fiscal plan [UPDATED]
Moody's Investors Service (Moody's) downgraded its rating on the state of Western Australia (WA) – and on Western Australian Treasury Corporation (WATC) – to Aa1 on August 25, based on the rating agency's belief in a growing risk that WA's deteriorating debt metrics and ongoing deficit position "may not be reversed soon". Moody's also changed its outlook on the state's rating, to stable from negative.