A review of things you need to know before you go home on Thursday; ANZ borrows $550m for 5-yrs at 3.03%; 3rd credit union rubber-stamps merger, CBA puts demergers on ice & more

A review of things you need to know before you go home on Thursday; ANZ borrows $550m for 5-yrs at 3.03%; 3rd credit union rubber-stamps merger, CBA puts demergers on ice & more

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

MORTGAGE RATE CHANGES
There were no changes today. However, Westpac is claiming a New Zealand first with a dedicated mortgage product aimed at helping people buy prefabricated homes.

TERM DEPOSIT RATE CHANGES
There were no changes today.

ANZ BORROWS $550M AT 3.03%
ANZ NZ is borrowing $550 million through an issue of five-year unsecured, unsubordinated fixed rate bonds. Investors will be paid an interest rate of 3.03% per annum after the margin over swap was set at 1.08%. ANZ's five-year term deposit rate is 3.60%. The bank was seeking a minimum of $100 million with the offer open to unlimited oversubscriptions. The offer was made to institutional and New Zealand retail investors.

MEMBERS OF THIRD CREDIT UNION BACK 5-WAY MERGER
Members of Credit Union South have backed a proposed five-way merger to create New Zealand's biggest credit union. Tania Dickie, CEO of CU South, says members voted 80.97% in favour of the deal at a special meeting. Members of Aotearoa Credit Union and Credit Union South have also backed the deal. Steelsands Credit Union members vote today followed by Credit Union Baywide members on Friday. The deal would effectively see CU Baywide take over the other four credit unions.

COMMERCE COMMISSION PROSECUTES '3RD TIER' CHRISTCHURCH LENDERS
The Commerce Commission says "third-tier" Christchurch lenders Alternate Finance Limited and Crester Credit Company Limited have been fined a total of $103,500 and ordered to pay more than $21,000 in statutory damages to borrowers, because some of their loan contracts included security interests taken over prohibited consumer goods, meaning the lenders could repossess them if the borrower did not make payments on the loan. The two companies pleaded guilty to four representative charges under the Credit Contracts and Consumer Finance Act.

FMA KIWISAVER TRACKER UPDATED
The Financial Markets Authority has updated its KiwiSaver tracker with data to the end of December 2018. "There is a sharp divide between one year and five year performance, reflecting volatile markets in the year to the end of December 2018. Investors should look to five-year for a long-term view on performance, where possible. KiwiSaver is a long-term investment. With negative returns, it is more important than ever for investors to understand the impact of fees on their returns. Over the five-year period, the Tracker broadly reflects that funds which are higher risk by holding more growth assets have delivered higher returns," the FMA says.

CBA DEMERGERS SUSPENDED
Across the Ditch ASB's parent Commonwealth Bank of Australia has "suspended preparations" for the demerger of its wealth management and mortgage broking businesses. CBA says this is so it can prioritise the implementation of the Royal Commission's recommendations, refund customers and remediate past issues. 

LOCAL SWAP RATES LITTLE CHANGED
The NZ two-year swap rate is unchanged at 1.83%, the five-year unchanged at 1.95% and the 10-year up one basis point at 2.35%.

NZ DOLLAR LITTLE CHANGED
The NZ dollar is little changed since this morning at US68.54 cents, AU96.85c, and €60.6c.

BITCOIN UP
Bitcoin is up about US$22 since this morning at US$3.866.31.

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17 Comments

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"ANZ borrows $550m for 5-yrs at 3.03%"

A little over a year ago, I lent money to Rabobank @ 4.27%, paid monthly and for 5-yrs. How inflation expectations are a changin.

ANZ is raising a huge amount of Capital .

I wonder what is driving this ?

Is it the new capital adequacy requirements ?
Does ANZ have a big tranche of bonds coming to term ?
Is this for expansion and lending growth?
How does it affect their WACC ( Weighted Average Cost of Capital ) ?

Surely better to take out a TD isn’t it? If they went under a TD would probably get some form of government bailout.

Well they are still paying 4% for retail 5 year money so what is that telling you?

https://www.rabodirect.co.nz/term-deposits/

And TradeMe Auckland listings tipped over 14,000.

Wow , 14,000 properties for sale in Auckland , where we have about 320,000 dwellings .

This is a simplistic calculation , but it appears that just shy of 5% of Auckland's housing stock may be on the market ?

Wow, nice little sprint for a Thursday to get over 14,000. Now to see if real estate co nz can get over 15,000.

Yeah but there's a housing shortage and blah, blah, blah.. I wonder if any of those are some of the 33,000-ish ghost houses dotted around the city?

Indeed Hardly

REINZ figures show 1358 sales in Auckland in February so essentially there is now 10 months of stock available at the current rate of transactions

so probably about 13,000 individual properties once you account for the ones that think listing with multiple agencies will help them shift their overpriced crapbox.
eg:
https://www.trademe.co.nz/property/residential-property-for-sale/auction...?
https://www.trademe.co.nz/property/residential-property-for-sale/auction...?
https://www.trademe.co.nz/property/residential-property-for-sale/auction...?

Owner is dropping the price.. but I think he's still a long way behind the market.. and not catching up.

Those places with high voltage transmission lines overhead are always hard to sell though.

And that one has two sets.. and is about $100k overpriced.

Been pretty quiet down here at the auction rooms in Tauranga. Some people's selling expectations are about 12 months behind reality. That'll catch up with them in the winter.

auckland looking similar. Yesterdasy barfoot afternoon auction, 14 properties went up.. so far 11 have been removed from the auction page (not sold), and nothing marked as sold. If all three remaining places sell they'll squeeze out a 21% clearance rate.

Unless the onsites do really well B&Ts clearance rate is going to be in the mid 20% range again.

Aussie property market now in "free fall" (warning: Granny Herald link)

"Aussie housing market may never recover from downturn."

If Sydney dips significantly Auckland will still be fine. Auckland has beaches, is cosmopolitan, has lots of things to do, plenty of nice plump ripe NIMBYs etc.

And the Central Interceptor is coming!

This video is a must see.
https://youtu.be/j81A9EIwSE8

Why is the FMA obsessed with fees. The only number that is important is after fees and tax. I could charge you $1 a year and the FMA would seem to be happy but so what if the return is 0.