Corporate bond maturities hit a peak
The domestic corporate bond market will see A$12.5 billion of bonds mature this month. This is the largest monthly volume of maturities, as currently scheduled, to the end of 2020.Yet new issuance volume for the month is modest, and is following the soft issuance trend that has been in place since the start of the year. It is rare for annual net issuance volume to be negative - it hasn't happened since the 1990s.With $74 billion of corporate bonds maturing this year, the second largest annual volume yet, net new issuance could again be very low.Helping with the replacement task was Westpac (rated AA-), which issued $2.15 billion of three-year floating rate notes. The notes were priced at 100 basis points over bank bills, two bps wider than where NAB priced a similar sized three-year issue three weeks ago.Some reasonable issuance volume was also provided by the Sydney branches of Bank of Tokyo-Mitsubishi (rated A+) and Overseas-Chinese Banking Corporation (rated AA-).Bank of Tokyo-Mitsubishi sold $500 million of four-year FRNs, priced at 150 bps over bank bills. OCBC sold $300 million of four-year FRNs, 120 bps over bank bills.International Finance Corporation (rated AAA) and Rentenbank (rated AAA) were the only other issuers last week.IFC added $150 million to its February 2021 line to take the total outstanding to $900 million. The increase was priced at 58.5 bps over commonwealth government securities.Rentenbank added $80 million to its May 2026 line. The increase, which was priced at 54.5 bps over CGS, takes the size of the line to $405 million.Last week was busy in New Zealand. Meridian Energy (rated BBB+) sold NZ$150 million of seven-year bonds and Genesis Energy (BBB+) launched a NZ$100 million bond issue. Nordic Investment Bank (rated AAA) opened a new March 2021 line at NZ$200 million, and ANZ New Zealand announced NZ$100 million, three and five-year issues to be listed on the NZDX.The Meridian bonds were priced at 160 bps over swap, to yield 4.53 per cent. The bookbuild for the six-year Genesis bonds will be conducted on Wednesday. The indicative margin range is 145 bps to 160 bps.The NIB bonds were priced at 68.3 bps over New Zealand government bonds, to yield 3.208 per cent, and the bookbuild for the ANZ FRNs will also be held on Wednesday, with the indicative margins set at 100 bps to 140 bps. Offshore, both Commonwealth Bank (rated AA-) and National Australia Bank (rated AA-) completed large issues. AusNet Services (rated A-) sold more subordinated notes.In the US s144A market, Commonwealth Bank raised a total of US$2.5 billion split between US$1.0 billion of five-year bonds and US$750 million each of three-year bonds and FRNs. The five-year bonds were priced at 125 bps over US Treasury bonds, the three-year bonds were priced at 108 bps over, and the FRNs were priced at 106 bps over Libor.In the same market, NAB sold US$1.4 billion of five-year covered bonds, priced 87.8 bps over Treasuries. This swapped back at a wide margin of 121 bps