Grosvenor Group, an international property company, and Dutch bank ABN Amro, announced on May 21 that they have agreed the first Australian property derivatives transaction.The two-year swap contract is based on the Australian Property Council/Investment Property Databank Australian property all-property total return index. The pricing of the transaction remains confidential, but its notional value has been confirmed to be less than A$10 million ($8.2 million).
"The Australian market is at a similar stage to that of the UK 18 months ago, and we are hoping to see it grow along UK growth lines," said Philip Ljubic of ABN Amro, who expects a few more transactions to complete this year. He adds that the transaction "is part of an educational process", designed to whet the appetites of investors for an Australian property derivatives market.
The transaction is subject to IPD granting a licence to trade derivatives based on the Australian indexes by the end of the swap's tenor. Ljubic expects that ABN will receive its licence within the next six months.
Topics: ABN Amro
More on Structured Products
Securities Financing Transactions Regulation could conflict with Emir reporting rules
Banks face loss of attractive source of dollar funding
Head of Office of Capital Markets Trends calls on issuers to examine sales practices
Eurozone QE programme prompts wave of investor interest
Sign up for Risk.net email alerts
Sponsored video: MarketAxess
Sponsored video: Tradeweb
Multifonds talks to Custody Risk on being nominated for the Post-Trade Technology Vendor of the Year at the Custody Risk Awards 2014
Sponsored webinar: IBM Risk Analytics
There are no comments submitted yet. Do you have an interesting opinion? Then be the first to post a comment.