Leading the charge
Perennial frontrunner Australia and New Zealand Banking Group rose with the tide in 2023 to cement its position as the go-to house in one of the few bond markets to experience year-on-year growth.
Australian dollar bond supply surged over 20% to A$212bn (US$139bn), including self-led transactions and excluding ABS, behind only the Covid-distorted A$236bn annual record in 2020 when emergency government supply was more than half the total.
“Demand for Australian dollar bonds from Asia has recovered after their withdrawal during Covid, while higher yields everywhere have increased investor appetite for fixed-income instruments, including greater weightings from local superannuation funds to reflect the asset class’s improved relative returns,” said Jimmy Choi, ANZ’s global head of DCM.
On the sellside, banks continued to raise huge amounts to refinance ultra-cheap three-year loans taken out under the Reserve Bank of Australia’s Covid-era Term Funding Facility, while corporate supply picked up from 2022’s nadir.
ANZ fully embraced this expansion with a table-topping 15.3% market share of the A$159bn market, excluding self-led deals, having been on 100 of the year’s 303 transactions and showing leadership across all segments.
Adam Gaydon, the bank’s head of syndication, pointed out that ANZ jointly led the largest Commonwealth, semi-government, financial and SSA transactions.
These comprised the Treasury’s A$14bn sale of April 2034s, Victoria’s A$3bn March 2029 trade, ANZ’s own record-breaking A$5.5bn MTN print, and A$1.5bn Kangaroos from both the World Bank and European Investment Bank.
ANZ was on tickets for every state and territory, nine regional banks, all Korean and Singaporean bank benchmarks, Spain’s Santander, Lloyds Banking Group’s A$750m 10-year non-call five Tier 2 note and Emirates NBD Bank’s A$450m senior 10-year trade.
Other highlights include a circa 30% share of the revived corporate market, including lead manager roles for Coles, WestConnex, Telstra, Contact Energy and Australian Gas.
It was sole lead for AusNet’s A$700m 10-year MTN and helped deliver New Zealand energy firm Chorus’s inaugural Kangaroo.
“The corporate bond market rebounded from A$6bn in 2022 to a more normal A$10bn-plus as investors became more comfortable extending duration, bank lending lost much of its competitive advantage and issuers sought diversification,” Choi explained.
In the ESG space, ANZ helped bring Western Australia to the green market with a blowout A$1.9bn debut and was arranger for Bank Australia’s inaugural A$225m four-year sustainability bond in February.
In addition, ANZ once again led the New Zealand bond market, having been on all but one of 2023’s Kauri trades.
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