Institutional demand lifts Australian dollar unrated capacity
Institutional investors’ growing willingness to engage with unrated and other forms of higher-yielding debt supported the substantially larger volume outcome achieved by Australia’s latest returning unrated issuer, the deal’s arranger says. NEXTDC priced A$300 million (US$222.5 million) of four-year bonds on 15 May from a significantly oversubscribed book according to deal sources.
S&P affirms Australia’s triple-A negative in annual sovereign review
S&P Global Ratings (S&P) affirmed its triple-A rating on the Australian sovereign – with negative outlook – on 17 May. S&P’s update reflects the consensus view of analysts that the 2017/18 Australian budget largely offers fiscal continuity rather than significant consolidation or deterioration.
Endeavour lease proceeds nix TCorp’s 2016/17 issuance task
The 11 May completion of the long-term lease of Endeavour Energy (Endeavour), the New South Wales (NSW) electricity distributor, has caused NSW Treasury Corporation (TCorp) to reduce its expected term-funding task for the current year to a A$200 million (US$146.8 million) net repayment of debt from the A$4 billion of net issuance previously forecast.
Major banks come out swinging against proposed levy
Australia’s big-four banks have attacked the levy on their liabilities proposed by the recent federal budget, describing the levy as a rushed, ill thought out, inadequately consulted piece of “bad policy”. All four majors published submissions made to Treasury on 15 May, in which they set out a raft of complaints and proposed changes to the levy.
BOQ introduces conditional pass through to Australian covered bonds
Bank of Queensland (BOQ) (A3/A-) revealed on 11 May that it has established a Reg S covered-bond programme with conditional pass-through (CPT) features. BOQ is the first Australian bank to introduce such a programme, which allows issuers at lower rating levels more efficient access to triple-A-rated covered-bond issuance.