ANZ buys time with pre-maturity test tweak

time
By Bill Thornhill
27 Jul 2020

ANZ has altered the pre-maturity test of the hard bullet transactions in its covered bond programme, by doubling the time the covered bond guarantor has to sell assets. The "investor-friendly" update, which improves rating stability, follows ANZ’s recent downgrade and could be of interest to other issuers in a similar situation.

ANZ updated the pre-maturity breach mechanism on A$1.57bn of outstanding hard bullet covered bonds, equating to 15.6% of the programme’s total liabilities. 

Following an issuer event of default, when recourse has switched to the cover pool, the pre-maturity test will now take place 12 months before maturity instead of ...

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