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Briefs: Debt capital markets come alive for Suncorp, Pepper and CBA, 'Basel IV' regulation, Macquari

09 October 2015 5:14PM
While announcing the A$8.2 billion purchase of Esanda dealer finance from ANZ Banking Group, Macquarie Group has also upgraded earnings guidance for its interim results a second time, putting it on track to report a profit of $2 billion or more for the year ended March 31, Fairfax Media has reported. Macquarie chief executive Nicholas Moore attributed Thursday's upgrade to the bringing forward of a performance fee from an asset sale and favourable trading conditions in financial markets. Suncorp-Metway said it would hold a series of investor meetings this week and has mandated the investment bankers at all Big Four banks as joint lead managers for a new Australian dollar senior unsecured benchmark issue, a term commonly understood to mean a debt raising of at least A$500 million. Timing for the transaction is "subject to market conditions" - a phrase that more often than not turns out to be code for "today or tomorrow". Financial system inquiry panel member Kevin Davis has urged Treasurer Scott Morrison to release the government's response to the inquiry and says banks serving customer interests should not fear new ASIC powers that could allow the regulator to temporarily ban certain financial products, according to Fairfax Media reports. The federal government's response to the FSI, chaired by David Murray, was due to be released the morning after the Liberal party room voted to change the leadership. Non-bank loan originator and servicer, Pepper Group, has mandated CBA, NAB and WBC to arrange a series of residential mortgage-backed securities debt investor meetings in Sydney in the week beginning 12 October. One of the bank advisers said Pepper was "exploring funding opportunities across a range of markets". The Commonwealth Bank of Australia has priced a new A$2.0 billion tranche of three-year senior unsecured floating rate notes, due for redemption on 19 October 2018. The notes were priced at 78 basis points over three-month BBSW.  The lead manager is CBA Institutional Banking and Markets. With Basel III not yet fully implemented, proposed adjustments to Basel standards are being floated, says Deloitte in a new white paper on regulation. The Basel IV package includes new standardised models, reducing the variance across banks using internal models, constraining parameter choices and outputs available to banks, and removing some of the discretion the current standards give to national supervisors. These revisions will ultimately make internal modelling choices more aligned to standardised approaches, with a likelihood of further increases in the amount of capital that many banks need to hold.

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