WATC’s new-money requirement eases in 2019/20 borrowing programme
Western Australian Treasury Corporation (WATC) revealed a A$7.7 billion (US$5.3 billion) borrowing programme for the 2019/20 financial year on 13 May, following the release of the Western Australia (WA) state budget on 9 May. The new-money requirement is A$1.1 billion, down from the estimated A$1.5 billion at the last update on 31 March.
NAB tests the water with domestic tier-two deal
On 9 May, National Australia Bank (NAB) became the first Australian major bank to price a tier-two deal since Australian Prudential Regulation Authority (APRA)’s proposed changes to tier-two capital requirements were released in November 2018. The issuer and lead say a small pricing premium still exists due to uncertainty around the instrument, but that investor appetite remains.
The big squeeze
The Australian asset-management industry continues to grow but it has yet to produce a consistently diverse local credit market. Allocations to income-generating product will likely increase over time, though market dynamics suggest the most liquid and highest yielding ends of the market may have the healthiest prospects.
Domestic market displays ongoing robust funding conditions despite issuance hiatus
Westpac Banking Corporation (Westpac)’s self-led deal on 8 May was the first of significant volume from any sector to come to the Australian market since mid-April, with public holidays and a Reserve Bank of Australia (RBA) cash-rate decision giving cause for pause. The issuer says the transaction’s outcome proves that the market remains highly constructive.
The financial sector and an ESG common cause
The Australian Sustainable Finance Initiative (ASFI) aims to “set out a roadmap for realigning the finance sector to support greater social, environmental and economic outcomes”. Following its launch at the end of March, KangaNews spoke to seven member institutions of the ASFI steering committee about the initiative’s goals and how they will be measured.