Suncorp continues to rely on private placements
Suncorp has made only one public bond issue since the government guarantee became available, issuing A$1.1 billion of April 2012 bonds in early December.
Yesterday, Suncorp reported that it had privately placed $500 million of August 2012 floating rate notes, at a margin of 90 basis points over bank bills.
The credit margin on this latest issue is a considerable improvement on the 140 basis points paid in December. The term to maturity for both issues differs by only one month.
Suncorp was particularly busy after that first issue, adding a further $170 million to the line a week later, then privately placing $500 million of October 2013 FRNs at 135 basis points over bank bills just before Christmas.
In early January it tapped the private market again, raising A$355 million for two years at 80 bps over bank bills.
On Monday, Westpac added A$210 million to the A$1.585 billion of floating rate notes that it issued early in the week before. The top-up to the three-year FRNs was priced at the same 60 bps over bank bills.
Also, details have become available on Westpac's Uridashi issue, announced at the beginning of this month. Westpac will issue A$105 million of three-year Uridashis on March 26. The bonds will pay a coupon of 3.49 per cent
The latest AOFM-backed RMBS issue was launched on Monday. AMP Bank's Progress 2009-1 Trust will place four tranches of notes comprising: $50 million of Class A-1 notes, provisionally rated AAA/Aaa with a 0.25 weighted average life; $450 million of Class A-2 notes, provisionally rated AAA/Aaa with a 3.8 year WAL; $18 million of Class AB notes provisionally rated AAA/NR with a 6.4 year WAL; and A$17 million of unrated Class B notes with a 6.4 year WAL.
Indicative pricing on the Class A-1 and A-2 notes at 90 bps and 130 bps respectively, is largely in line with that seen on the Torrens Series 2009-1 Trust priced on Friday.
Again, AOFM is expected to take up the Class A-2 tranche in full, with institutional investors restricting their interest to the Class A-1 tranche. Pricing is expected on Monday.
Standard & Poor's has again lowered the ratings on three tranches of Seiza Augustus 2007-1 Trust notes but affirmed the ratings on the four senior tranches. Ratings on the Class C, M and D tranches were lowered to A-, A- and BB-, from A, A and BB, respectively.
S&P noted that additional information has become available on the concentration of properties, within the underlying portfolio of residential and small-ticket commercial property loans, in troubled areas with poor recoverability. This will increase the portfolio's sensitivity to default and recoveries could be reduced.
S&P did not lower the CCC+ rating on the Class E notes or the CCC- rating on the Class F notes as the ratings already reflect the credit risk faced by these deeply subordinated notes.