Putting NZ back up on the radar screen

ANZ's David Green. Photo / Supplied

Roadshows help boost Kiwi image in Asian markets.

A series of Kiwi Day roadshows in Hong Kong and Singapore have paved the way for a new "New Zealand story" which will underpin efforts by Kiwi corporates to continue to source the Asian debt capital market.

ANZ's David Green says his bank made a deliberate decision to take key corporate clients up to Asia after the global financial crisis impacted on funding. "When we came up with the idea of doing it, global debt capital markets were effectively frozen," says Green who is managing director of ANZ's Institutional New Zealand.

He recalls that while New Zealand had differentiated itself because it has a strong retail market, and corporates were funding effectively through that, many had traditionally used US markets and European markets that simply weren't there. With debt maturities fast coming up, it was an opportune time to tap the significant liquidity sitting up in Asia.

"They were looking for high quality issuers - well-rated industries they understood - and a lot of the issuers we took from New Zealand were infrastructure: energy or airports and telecoms.

The Fonterra story is well understood in Asia. But ANZ also enlisted the support of key players from the Debt Management Office and the Reserve Bank to join the roadshows. "You need something which is a bit more of a magnet to get the attentions of investors ... by having what are effectively NZ's largest issuers and largest companies there with the Government and Reserve Bank it was quite a good focus point for people to say, 'let's get to understand New Zealand'.

"We thought there is a natural connection between NZ and Asia".

In Hong Kong and Singapore they presented to rooms of around 100 investors.

In March, ANZ successfully arranged the first-ever issue for a Kiwi corporate in the Hong Kong dollar bond market. The 10-year $73.1 million deal for state-owned Transpower is one of the largest bond issues by a non-Hong Kong based corporate in the Hong Kong dollar bond market in 2010.

Other NZ corporates attending the Hong Kong road show included Auckland Airport, Fletcher Building, Fonterra, Goodman Property Trust, Meridian Energy and Telecom. The bank's Asian strategy was a key reason why it was awarded Business Herald Bank of the Year at the 2010 Infinz Awards.

Green points to a "new normal" - in which the way customers and banks think about funding is fundamentally different from two years ago. Corporates are now more focused on longer term funding and diversification. "Price is not the driving feature of a successful funding programme ... it's having the money."

But Green warns that the European turmoil off the back of the Greece financial crisis is evidence there will continue to be "bumps along the way."

Another crucial issue is global changes to the regulation of the finan- cial and banking sector and new capital restrictions. But while NZ's traditional trading partners in the northern hemisphere might be finding life a bit tough, New Zealand is buffered as it has about 60 per cent of its exports going to Australia and Asia.

ANZ is also one of the key sponsors of the NZ Pavilion at the Shanghai Expo and is leveraging the high-profile event to take its broader customer base to China to help them understand the opportunities that exist there.

"Not every customer who goes to China will necessarily do business up there but there will be implications due to the prospects for "the NZ economy.

The relationship is a two-way street. ANZ was intimately involved with the recapitalisation of Fisher & Paykel Appliances and PGG Wrightson by Chinese companies.