The reference-rate conundrum
The impending likely demise of global interbank offered rates has sparked many questions for the Australian market. Its local credit reference rate appears to be relatively robust – though its status is not unimpeachable – while the importance of cross-border issuance to Australian borrowers requires engagement with international IBOR developments. KangaNews and Commonwealth Bank of Australia brought together key market participants in late January to discuss the way forward.
New Zealand debt market eyes a shake-up
Proposed new capital requirements for New Zealand’s banking sector are causing consternation in the local debt market as participants grapple with a raft of potential implications. The consequences for the fixed-income sector – intended and unintended – are potentially game-changing and are relevant to sectors as diverse as the high-grade Kauri market and corporate debt.
RBNZ sticking to a fundamental line on capital recalibration
A 26 February speech by Reserve Bank of New Zealand (RBNZ) deputy governor, Geoff Bascand, suggests local banks face a tough task in persuading the regulator to rethink its recent proposals for a significant increase to capital requirements. Consultation on the proposals is open and Bascand said the RBNZ will listen to responses, but his speech suggests it is comfortable with its thinking to date.
Market evolution allows Virgin to refinance US dollars domestically
Virgin Australia (Virgin)’s second Australian dollar bond deal built on the success of its initial transaction and capitalised on an increasingly positive market backdrop to broaden the issuer’s capital-markets footprint, deal sources say. The new transaction allows the issuer to refinance US dollar liabilities in its home currency.
Contact breaks new ground with New Zealand’s first corporate green bond
Contact Energy (Contact) became the first corporate borrower to price a green bond in New Zealand on 22 February. Deal sources say the transaction benefited from greater-than-expected support from domestic retail and offshore institutional investors, and is reflective of continually growing momentum.