A review of things you need to know before you go home on Monday; BNZ cuts TD rates, steady Westpac result, more living alone, more corporate bond issues, one with a catch, KiwiSaver facts, swaps inch up, NZD rises

Here are the key things you need to know before you leave work today.

TODAY'S MORTGAGE RATE CHANGES
No rate changes to report today.

TODAY'S DEPOSIT RATE CHANGES
BNZ reduced both its nine month term deposit rate (down -20 bps) and their one year term deposit rate (down -10 bps).

STEADY WESTPAC RESULT
Westpac NZ posted a 2% rise in interim cash earnings to $445 million. The increase came as impairment charges fell to $9 million from $31 million. Net operating income rose 2.2% to $1.082 billion, and operating expenses increased 8% to $457 million. The bank's net interest margin fell 8 basis points to 2.15%, which the bank blamed on competition in the mortgage and business lending markets.

TWO'S A CROWD
More and more people are living alone, most often because they are divorced, separated, or widowed. This trend is raising the number of households faster than the population increase. In terms of home ownership, 6 out of 10 (62%) people who lived alone owned or partly owned their own home. This compared with only 50% for those who lived with others.

BOND ISSUES SPRUIKED
Wellington International Airport has announced an offer of up to $50 million of seven year, unsecured, unsubordinated, fixed rate bonds maturing on 12 May 2023 to New Zealand retail and institutional investors. They will yield about 5.8%. Insurance Australia Group also is planning to offer up to $250 million of unsecured subordinated convertible notes to institutional investors and New Zealand retail investors for up to 27 years. The expected yield was not revealed. These notes carry a special risk; if IAG hits some financial or claims trouble, they will convert to equity (and right at the time their equity will suffer a very large discount).

FACTORIES HUMMING
The recent impressive improvement in Aussie factory expansion eased back in April to 53.4, but still strongly expansionary. The last NZ factory PMI was at 54.6 on the same basis in March. These levels are far above what we see in the US, China, Japan or Europe.

KIWISAVER HITS THE BIG TIME
Almost $0.5 bln was extracted from KiwiSaver accounts over the past 13 months for use to buy a first home, the fastest rate of withdrawal ever. Assuming this became a 20% deposit, it supported $2.5 bln of house buying over the period. If the average purchase was at the NZ first quartile level (ie $309,000), then it supported the purchase of 8,100 houses, about 9% of all houses bought and sold. Also over the past year, more than $55 mln has also been extracted from KiwiSaver for 'financial hardship', or almost $5,000 per withdrawal. There are now more than 2.6 mln people in KiwiSaver who are actively contributing. According to the RBNZ, the value of all KiwiSaver investment is now more than $32 bln. Even though it is a giant honey-pot for the funds management industry, our analysis shows that the better run funds are building balances far better than bank term deposits. Actually, even averagely run funds are doing better than that.

WHOLESALE RATES
Rates rose +1 bp across the whole term spectrum. NZ swap rates are here. The 90-day bank bill rate fell by -2 bps to 2.38%.

NZ DOLLAR RISES
The Kiwi dollar has risen above 70 USc today, reaching 70.2 at one point. The NZD is now just on 70.0 USc, at 92 AUc and 61.1 euro cents. The TWI-5 is at 72.6. Check our real-time charts here.

You can now see an animation of this chart. Click on it, or click here.