Turmoil drives strategy divergence among Europe's largest Kangaroo borrowers
Name-specific responses to the European sovereign debt crisis in the Australian dollar market have led the largest Kangaroo borrowers to adopt contrasting issuance approaches. European Investment Bank (EIB) (AAA/Aaa/AAA) has reduced its Kangaroo activity in response to pricing relativities, while KfW Bankengruppe (KfW)'s (AAA/Aaa/AAA) consistent issuance volume has seen it take over as the market's biggest borrower.Kauri conditions coalescing but few other bright spots in troubled market
In a week overshadowed by global turmoil, just one deal priced in the Australian public markets. On the other side of the Tasman, World Bank (AAA/Aaa) issued a new Kauri deal on August 3 as market participants report that Kauri pricing levels have become more attractive in recent times. However, with investors' name-specific appetite divergent what remains uncertain is which borrowers are most likely to be able to seize future issuance opportunities.World Bank issues its first Kauri in over a year [UPDATED]
World Bank (AAA/Aaa) priced a new NZ$300 million (US$258.7 million) five-year Kauri transaction on August 3, in what was its first deal in New Zealand's domestic market since July last year. New Zealand market participants say potential pricing for Kauris has grown closer to economic levels in recent times, although there has so far been just NZ$900 million issued in the format this year.KfW takes A$300 million in February 2018 Kangaroo tap [UPDATED]
KfW Bankengruppe (KfW) (AAA/Aaa/AAA) launched and priced a A$300 million (US$320.2 million) increase to its February 2018 Kangaroo on August 4. The tap is the third increase to the line, which was introduced in February 2011 at a size of A$500 million and now has A$1.55 billion outstanding.
Covered bonds met with growing demand as issuers seek funding diversity
While Australian domestic banks await the final passage of legislation that will allow them to issue covered bonds, the Kangaroo market for covered bonds is experiencing steady growth. Four issuers have priced five deals so far this year for a total volume of A$2.9 billion (US$3.2 billion).