Bloomberg News

ANZ Bank Said to Plan Its First Covered Bond Sale in Euros

January 02, 2012

(Adds law change from first paragraph.)

Dec. 30 (Bloomberg) -- Australia & New Zealand Banking Group Ltd., one of the nation’s so-called four pillar lenders, is planning to issue its first covered bonds in euros after a change in the law allowed the sale of the asset-backed notes.

ANZ hired Barclays Capital, Natixis, UBS AG and UniCredit SpA to manage the sale, which will take place early in 2012 subject to market conditions, according to a banker involved. The Melbourne-based bank raised $1.25 billion from an issue of 2.4 percent dollar covered bonds due 2016 on Nov. 15, its first public sale of the notes in any currency, Bloomberg data show.

The new euro issue, as well as last month’s U.S. dollar sale, follow an amendment to Australia’s Banking Act in October that allows the country’s banks to sell covered bonds. Traditionally issued by European lenders, the securities are backed by mortgages or other assets as well as the issuer’s guarantee and typically carry top credit ratings.

Commonwealth Bank of Australia, the nation’s biggest lender, was also said in November to be planning its first covered bond sale after the legislation change. National Australia Bank sold 2.5 billion Norwegian krone ($416 million) of 5 percent covered notes maturing in 2021 earlier this month, while Westpac issued $1 billion of 2.45 percent bonds due 2016 on Nov. 17, according to data compiled by Bloomberg.

ANZ’s new deal is due to be rated Aaa by Moody’s Investor’s Service and AAA by Fitch Ratings, said the banker involved in the deal, who declined to be identified before it’s completed.

--Editor: Paul Armstrong

To contact the reporter on this story: Abigail Moses in London at amoses5@bloomberg.net

To contact the editor responsible for this story: Paul Armstrong at parmstrong10@bloomberg.net


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