Bond issuers take time out to mull monetary policy decision
Corporate bond market participants were more focused on the Reserve Bank's decision regarding the cash rate on Tuesday, and digesting the implications of that, than on issuance activity. Issuance activity last week was limited to line tapping by a few constituents of the supranational sovereign and agency sector.Not surprisingly, no issuance was seen from the major banks last week.Bank Nederlandse Gemeenten (rated AAA) added A$25 million to its August 2026 line, taking the size of the line to $135 million. The increase was priced at 86.25 basis points over commonwealth government securities.Province of Quebec (rated A+) added $80 million its May 2026 line, taking the size of the line to $515 million. The increase was priced at 82.75 over CGS.International Finance Corporation (rated AAA) added $70 million to its July 2026 line, taking the size of the line to $630 million. The increase was priced at 56.5 bps over CGS. IFC fronted up again on Friday to add another $20 million to the line. The second increase was priced marginally tighter at CGS plus 55.75 bps.KfW (rated AAA) added $450 million to its February 2021 line, taking the size of the line to $1.25 billion. The increase was priced at 51.5 bps over CGS.Inter-American Development Bank (rated AAA) added $50 million to its June 2026 line, taking outstandings to $240 million. The increase was priced at 61.5 bps over CGS.LBank (rated AAA) opened a new February 2021 line at $200 million, paying 56 bps over swap and 76.25 bps over CGS, and Province of Manitoba increased its June 2026 line by $50 million to $220 million. The increase was priced at CGS plus 80.5 bps. In the structured finance sector, Bank of Queensland completed a $170 million refinancing of the Class A2 notes issued in the Series 2013-1 REDS Trust transaction. The notes were replaced by issuing Class A2R notes with a weighted average life of 3.6 years and priced at 135 bps over 30-day bank bills.Resimac launched a new non-conforming RMBS transaction via Resimac Bastille Trust, RESIMAC Series 2016-1NC, and on Friday Bendigo and Adelaide Bank launched its Torrens Series 2016-1 prime RMBS transaction. The simple three-tranche structure comprises $460 million of Class A notes, $30 million of Class B notes and $10 million of Class C notes.Standard & Poor's has assigned preliminary AAAsf and A+sf ratings to the Class A and B notes respectively. The Class C notes are unrated.Moody's Investors Service assigned a 'Aaasf' preliminary rating to the Class A notes only.Across the Tasman, Westpac completed the bookbuild for its new T2 subordinated debt issue, announced the week before. The issue was upsized to NZ$400 million from NZ$250 million and the credit margin was set at the low end of the 260 bps to 280 bps indicated range.The notes will pay a fixed 4.695 per cent for the first five years. At the end of this period the coupon rate may be reset or the notes may be called. If the notes are not called they will