DCM wrap: Rabobank goes to the NZ listed market

Westpac, Macquarie Bank and Rabobank were among local financial institutions that were active in the corporate bond market last week.

Westpac issued A$50 million of ten-year covered bonds. The coupon was set at 3.875 per cent.



Corporacion Andina de Fomento (rated AA-) added $75 million to the $150 million it had issued only the week before. Pricing was three basis points tighter at 162.25 bps over commonwealth government securities.


Inter-American Development Bank (rated AAA) added another $150 million to its February 2020 line, and Kommunalbanken (rated AAA) added $50 million to its July 2025 line. The increases take the total outstanding to $1.4 billion and $800 million, and were priced at 48.5 bps and 58.75 bps over CGS, respectively.



Dexus Wholesale Property Fund (rated A) returned to the market with a $150 million, seven-year issue, priced at 130 bps over swap. DWPF last issued almost exactly one year ago, when it raised $100 million for five years, priced at 110 bps over.



The DWPF issue must have sparked some unexpected interest as the company returned with a $50 million, ten-year bond issue on Friday. These bonds were priced at 155 bps over swap to yield 4.795 per cent.



Energy Partnership Gas (rated BBB-) last issued in June 2007, when it sold $200 million of ten-year, credit-wrapped floating rate notes. The FRNs were priced at just 24 bps over swap but before Thursday were marked at about 185 bps over. 

On Thursday, EPG sold $210 million of five-year bonds at a spread of 165 bps over swap.

Canadian Imperial Bank of Commerce also issued covered bonds on Friday. The $300 million of five-year FRNs were priced at 65 bps over the bank bill rate. 



In New Zealand, Rabobank (rated A+) used the listed market to sell NZ$400 million of five-year bonds. The issue, priced at 98 bps over swap, is the largest issue the bank has undertaken in New Zealand.



Using the listed route allowed the bank to attract a diverse range of offshore investors.



New Zealand's Local Government Funding Agency completed its latest tender. NZ$35 million, NZ$70 million and NZ$75 million was added to the April 2020, 2023 and 2025 lines, at average yields of 3.766 per cent, 4.0816 per cent and 4.3524 per cent respectively.



Offshore, Macquarie Bank (rated A) used the US s144A market to sell US$750 million of tier two debt. The ten-year, non-call-five bonds were priced at 265 bps over US Treasury bonds, with the proceeds swapping back to Australian dollars at about 300 bps over.



And Mercedes-Benz Australia (rated A-) raised $100 million in the Euromarket. The three-year bonds will pay 2.625 per cent.