SSAs find path through post Brexit maze
The fall-out in global capital markets from the Brexit vote last month ensured that there was little activity in the domestic corporate bond market until the end of last week. The highlight of the week was the listing of Westpac's Capital Notes 4 on the ASX on Friday.Westpac advised the market that it had raised approximately A$1.7 billion of additional tier one capital from the issue and applications for the notes in excess of A$25,000 were scaled back to 87.5 per cent. This is a strong outcome given that the size of the issue when launched was put at A$750 million.Activity in the wholesale market was mostly limited to long dated line tapping by sovereign and supranational issuers. And Friday saw a rush of such issuance.KfW (rated AAA) added A$400 million to its January 2019 line. Nederlandse Waterschapsbank (AAA) added A$55 million to its September 2026 line. Fonterra Co-operative Group (A-) also added A$55 million to its June 2026 line, and Nordic Investment Bank (AAA) added A$50 million to its February 2026 line. The increases were priced at 55.25 basis points and 79.5 bps over Commonwealth bonds for KfW and Nederlandse Waterschapsbank, 165 bps over swap for Fonterra, and 55.25 bps over for NIB.Outstandings now total A$1.9 billion, A$265 million, A$180 million and A$220 million, respectively.International Finance Corporation (AAA) started things off on Tuesday, by adding A$30 million to its July 2026 line. The increase was priced at 54 bps over CGS and takes the line to A$560 million.Rentenbank (AAA) followed quickly on the same day, adding A$50 million to its May 2026 line. The size of the line now stands at A$655 million and the increase was priced at 55.75 bps over CGS.Kommunalbanken (AAA) and African Development Bank (AAA) followed on Wednesday, adding A$30 million and A$60 million to their July 2025 and June 2026 lines, respectively. The increases were priced at 68.25 bps and 50.75 bps, and take the size of each line to A$1,075 million and A$215 million.Thursday saw Auckland Council (AA) and Inter-American Development Bank add A$55 million and A$30 million to their March and June 2026 lines. The increases were priced at 83.25 bps and 50.75 bps over CGS and take the totals outstanding to A$240 million and A$190 million, respectively. Offshore, Woodside Petroleum saw out the old financial year with a CHF175 million 7.5 year bond issue. The bonds were issued at a spread of 156.25 bps over mid-swaps.This appears to be the first time Woodside has issued bonds denominated in a currency other than US dollars, the company's operational currency.