insto - Australian financial markets

The Australian Office of Financial Management (AOFM) plans to hold the following tenders for the issue of Treasury Bonds and Treasury Notes. Details are:

Treasury Bonds:
• Wednesday, 9 December - A tender for the issue of $700 million of the May 2013 Bond line. This will be the final Treasury bond tender for the current calendar year.

Treasury Notes:
• Thursday, 10 December - A tender for the issue of $300 million of Treasury Notes maturing on 12 February 2010 and $300 million of 23 April 2010.

AOFM $500 m May 2021 Treasury Bonds
Durig the week ended 27 November 2009 the Australian Office of Financial Management announced the sale of A$500 million 5.75 per cent 15 May 2021 treasury bonds at a weighted average yield of 5.425 per cent. Tender results are:

There will be a change in approach from the Australian Office of Financial Management in the way it goes about announcing tenders for government securities.

Insto heard [during the week ended 13 November 2009] that the AOFM is streamlining its announcement process, so that from now on, Friday will be the official announcement day for all tenders that will be run during the following week. This is a departure from the current practice of publicising tenders one business day beforehand.

This change affects all Commonwealth securities handled by the AOFM: Treasury Notes, Treasury Bonds and Treasury-Indexed Bonds.

There was an update from the Australian Office of Financial Management (AOFM) soon after we reported this change of approach, as follows:

The ABS markets have been dormant for a year, cutting off funding to niche lenders. But were obituaries for Australia’s non-bank mortgage originators written prematurely, asks Lachlan Colquhoun.

Several September deals have encouraged issuers and also investors to think there is life in the assetbacked securitisation markets yet. These may be only stirrings, but among issuers at least there is a consensus that the next 12 months will be an improvement on the last period of darkness.

If there was any doubt that 2009 was the year that the domestic bond market had got its groove back, it was well and truly erased in the third quarter, reports Jonathan Shapiro.

Conditions continued to improve, increasing the confidence of both issuers and investors.

From July to September, over A$30 billion of non-government bonds were printed, making it the busiest period of the year, exceeding Q2 total issuance by A$10 million and more than double the amount issued in the third quarter of 2008.

The local securitisation industry spent the week assessing the merits of the Treasury’s decision to extend the AOFM's RMBS investment scheme.

The announcement came at a time when the market for mortgage backed securities was in the early stages of resurrecting itself, but the commitment of new funds means that it may be a while yet before the market stands on its own two feet.

Treasurer Wayne Swan has said that the government will extend its investment in Australian RMBS to ‘support competition in Australia’s mortgage market’.

Up to a further A$8bn of funds, depending on market conditions, is to be provided to support primary RMBS issuance, with the intention of helping smaller lenders, promoting mortgage market competition and reducing borrowing rates.

The AOFM has announced that it has printed A$4bn face value of a new 3.00 per cent 20 September 2025 syndicated Treasury Indexed Bond. The amount excludes A$10m that will be taken up by the RBA.

The deal was launched on Tuesday 29 September with a price guidance of zero to five basis points over the 20 August 2020 index bonds and received bids of over A$5.486bn, before the pricing was decided at a yield spread of one basis point over the 2020 indexed bond.