Kangaroo programme the way to engage domestic investors on TLAC
Standard Chartered priced its debut Kangaroo transaction on 25 June, with a A$1 billion (US$700.1 million) deal eligible for minimum requirement for own funds and eligible liabilities (MREL). Deal sources say the Kangaroo format is becoming a reliable means for global financial institutions (FIs) to gain domestic investor penetration with total loss-absorbing capacity (TLAC)-eligible deals.
S&P takes a different view on RBNZ capital impost
S&P Global Ratings (S&P) published a report on 26 June, positing that the Reserve Bank of New Zealand (RBNZ)’s proposed increase to bank-capital requirements will have minimal effect on the availability of credit in New Zealand, based on capital requirements stipulated by Australian Prudential Regulation Authority (APRA).
Australian investors give the thumbs up to Barclays holdco deal
Barclays received a blowout book in its recent Kangaroo deal, leading it to upsize to its maximum volume. The spread pick-up over domestic and global peers, lack of credit diversity and increasing acceptance of holding company (holdco) financial institution (FI) debt all gave domestic investors reasons to participate.
Balance-sheet growth behind ICBC NZ’s record domestic deal
Balance-sheet asset growth is driving an increased funding need for Industrial and Commercial Bank of China New Zealand Branch (ICBC NZ), the issuer says. This translated into a NZ$200 million (US$132.6 million) print on 21 June which, according to KangaNews data, is the bank’s largest-ever New Zealand dollar deal.
New Zealand corporate demand proving resilient to low coupons
Coupons in New Zealand’s retail corporate bond market continue to reach new lows, with Mercury’s deal priced on 19 June a record low for a subordinated-capital deal. The issuer and arranger say that retail investors will take time to adjust to lower coupons, but with redemptions in New Zealand currently outpacing supply, demand has been forthcoming.