Trading margins of ASX-listed notes and bonds moved up but mostly because of one particular short-dated security. The median trading margin jumped from 1.89% (after adjusting for removal of APT Pipeline Notes) to 2.80%. While yields on most securities increased, the major reason behind the jump was a much-higher trading margin of Suncorp Notes (ASX code: SUNPD, +188bps). Suncorp Notes currently have a wide “bid-offer spread” and almost all of the increased yield was due to the closing price moving from a place close to the offer price to one close to the bid price. Being within a year of its maturity date does not help. The yield of Bentham IMF Bonds (ASX code: IMFHA, +99bps) also shot up.
APT Pipeline Notes (ASX code: AQHHA) ceased trading on 21 March and it has been removed from the tables below.
The current 3 month BBSW rate is around 1.99%. Add the trading margin from the above chart or from the tables to 1.99% for a gross return per annum in the absence of BBSW rate changes. The gross return may contain imputation credits. BBSW typically is around 15bps (average since 1990) more than the RBA rate.
ASX LISTED FLOATING RATE NOTES
| COMPANY | CODE | BOND TYPE | MATURITY | ISSUE MARGIN | TRADING MARGIN | Δ WEEK | WEEK CLOSE | RUNNING YIELD** |
|---|---|---|---|---|---|---|---|---|
| AGL | AGLHA | Sub Note | 8-Jun-19 | 3.80% | 2.16% | -0.02% | 102.20 | 5.67% |
| AMP | AMPHA | Sub Note II | 18-Dec-18 | 2.65% | 1.48% | 0.51% | 100.93 | 4.59% |
| Australian Unity | AYUHB | Unsub. Bond | 15-Dec-20 | 2.80% | 1.38% | -0.09% | 104.50 | 4.62% |
| Crown | CWNHA | Sub Note | 14-Sep-18 | 5.00% | 3.97% | 0.01% | 100.70 | 6.95% |
| Crown | CWNHB | Sub Note | 23-Jul-21 | 4.00% | 3.74% | 0.01% | 101.10 | 5.93% |
| Bentham IMF | IMFHA | Bond | 30-Jun-19 | 4.20% | 3.75% | 0.99% | 101.85 | 6.15% |
| Nat Aust Bank | NABPE | Sub Note T2 | 20-Jun-23 | 2.20% | 1.70% | 0.17% | 102.50 | 4.08% |
| Qube Holdings | QUBHA | Sub Note | 5-Oct-23 | 3.90% | 3.74% | 0.01% | 105.50 | 5.64% |
| Suncorp-Metway | SUNPD | Sub NoteI T2 | 21-Nov-18 | 2.85% | 3.43% | 1.88% | 100.04 | 4.85% |
| Tatts | TTSHA | Snr. Bond | 5-Jul-19 | 3.10% | 1.60% | 0.09% | 102.95 | 4.99% |
| Villa World | VLWHA | Snr. Bond | 21-Apr-22 | 4.75% | 4.29% | 0.28% | 102.90 | 6.61% |
| Westpac | WBCHB | Sub Note T2 | 22-Aug-18 | 2.30% | 2.01% | 0.40% | 100.47 | 4.28% |