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MuniFin returned to New Zealand’s Kauri market

A decorative picture of Kauri trees growin in New Zeeland.

On June 12th, 2020 MuniFin issued a new 3-year NZD 150 million public Kauri transaction in New Zealand. Previous public transaction in New Zealand was issued in 2013, which matured in May 2020. Prior to launching the transaction MuniFin organised an investor call targeted for domestic investors and based on the positive feedback, MuniFin decided to move forward and launch a public transaction.

”We were positively surprised with investor demand”, says Antti Kontio, Head of Funding at MuniFin. ”The order book grew to NZD 270 million so we could have printed a larger trade but unfortunately due to our good liquidity situation we could do only NZD 150 million. We will, however, be open for taps on that line in the future. Kauri market acts as an excellent diversification tool for MuniFin in terms of currency and investor base”, Kontio says.

The new 150 million NZD Kauri is repo eligible in the Reserve Bank of New Zealand and pays an semi-annual coupon of 0.625% and was priced 46 basis points over mid-swaps and 39 basis points over the New Zealand Government bond. Bank of New Zealand (BNZ) acted as a sole lead manager.

“With seven years since the last issue, NZ investors very much appreciated the call with the MuniFin team, and were straight away interested in a transaction following it. There was a very good uptake of the transaction by real money investors, demonstrating the confidence they have in the credit”, said Mike Faville, who is leading the Capital Markets function at BNZ.

Bank of New Zealand has been running a programme to plant 100 Kauri trees for each Kauri bond issue we lead, and there are now over 10,000 trees already planted. “We really look forward to planting another 100 trees in honour of MuniFin for this transaction, to join the 100 from the last deal”, Mike Faville concludes.

Further information:

Antti Kontio
Head of Funding, MuniFin
tel. +358 50 3700285

Mike Faville
Head of Capital Markets, Bank of New Zealand
tel. +64 9 375 1391