Trading margins for ASX-listed notes rose substantially this week, with the median trading margin moving from 1.52% to 1.73%. The rise was driven by Tatts Bonds (ASX code: TTSHA, +77bps) and AMP Notes (ASX code: AMPHA, +58bps). Quite often moves of this size are associated with securities which have maturity dates fast approaching but this is not the case with either of these securities. Crown has announced a buy-back for its series 1 notes (ASX code: CWNHA) to be held sometime in 2017 but as any other details are unavailable, the market for the notes did not react much.
In other news, Colonial Notes (ASX code: CNGHA) holders should have received a redemption notice by now, as well as an offer to invest the redemption proceeds into a new AT1 hybrid issued by Colonial’s parent, Commonwealth Bank. Colonial Notes are now on a -1.85% trading margin, which sounds awful but an internal rate of return calculation provides an annualised figure of 4.20%. Readers will note this 4.20% does not include any transaction costs which would almost-certainly make a short-term investment of this type uneconomic.
ASX LISTED FLOATING RATE NOTES
|Δ WEEK||WEEK |
|AMP||AMPHA||Sub Note II||18-Dec-18||2.65%||1.66%||0.58%||102.50||3.44%|
|ANZ Banking Group||ANZHA||Sub Note II||14-Jun-17||2.75%||1.03%||0.26%||101.30||2.81%|
|APT Pipelines||AQHHA||Sub Note||31-Mar-18||4.50%||1.93%||-0.29%||103.60||3.71%|
|Goodman Group||GMPPA||Sub Note||30-Sep-18||3.90%||3.15%||0.09%||101.99||4.93%|
|Nat Aust Bank||NABHB||Sub Note II||18-Jun-17||2.75%||0.65%||-0.59%||101.42||2.43%|
|QUBE Holdings Limited||QUBHA||Sub Note||5-Oct-23||3.90%||3.03%||0.02%||105.50||4.81%|
|Suncorp Metway||SUNPD||Sub Note III||21-Nov-18||2.85%||1.49%||0.01%||102.27||3.27%|
|Westpac||WBCHA||Sub Note II||23-Aug-17||2.75%||0.50%||-0.69%||101.04||2.28%|
|Westpac||WBCHB||Sub Note III||22-Aug-18||2.30%||1.06%||-0.45%||101.77||2.84%|
ASX LISTED FIXED RATE BONDS
|Heritage BS||HBSHB||Snr Bond||20/06/2017||7.25%||102.50||102.24||102.30||4.35%||155.43%|
Source: Evans & Partners. Dealing Contact Michael Saba +61 3 9631 9813