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Westpac Banking Corporation (AA/Aa1) (Westpac), for some time the only Australian big four bank not to have issued into its home market under the terms of the government guarantee, priced its second domestic benchmark in under a fortnight on March 11 in the form of a record A$3.06 billion (US$1.96 billion) of fixed and floating rate 2012 paper.
Pricing on Credit Union Australia (CUA)'s Harvey Trust Series 2009-1 (Harvey 2009-1) residential mortgage backed security (RMBS) transaction has been set at the levels anticipated by investors – 100 basis points and 140 basis points above BBSW for the two top-rated tranches respectively.
Third party investors may play a smaller role in the latest residential mortgage backed security (RMBS) transaction to receive a cornerstone bid from the Australian Office of Financial Management (AOFM), although the overall size of the deal is greater than the most recent previous transaction and the underlying mortgage pool is a particularly stable one.
The three major Australian banks that had their outlooks revised to negative by Moody's Investors Service (Moody's) at the start of the week have seen little immediate impact on either the secondary market for their bonds – including those not covered by the government guarantee – or, funding managers insist, on investor sentiment.
KangaNews has learned that almost all the five-year funding done by the Australian majors in the US market since the dawn of the guaranteed era was bought by a single investor, with three of the big four tapping the market for 2014 maturity deals in January using the same lead manager.