BNZ pays up for covered bond debut 15 June 2010 4:59PM Philip Bayley Bank of New Zealand priced the first covered bond issue in New Zealand, yesterday. The two-tranche issue consisted of NZ$175 million of June 2015 bonds priced at 98 basis points over swap and NZ$250 million of seven-year bonds priced at 112 bps over swap. The pricing on the five-year tranche is well outside the expected range of 68 bps to 80 bps, based on five-year pricing for the major banks last seen in March, and provides further evidence of the credit spread widening that has occurred in recent weeks. Westpac New Zealand has said that it wants to issue up to NZ$5 billion of covered bonds both domestically and internationally. It expects to issue before the end of the year.