Investment in Auckland
On 1 November 2010, the previous eight councils in Auckland amalgamated to form Auckland Council - New Zealand's largest local authority. Auckland is New Zealand's leading economic region, generating more than a third of the nation's GDP
A strong institutional framework for local and regional governments supports Auckland Council's financial strength and stability. This includes the requirement to ensure our operating revenue is greater than our operating expenses each year. Borrowings are typically used to invest in new assets. How Auckland Council manages borrowings and investments is contained in its Treasury Management Policy. More information is also available through our Annual Report.
Under the Local Government (Rating) Act 2002, Auckland Council has flexible powers to set, access and collect rates to fund its activities. Auckland Council has provided security over its rates and rates revenue under a Debenture Trust Deed between Auckland Council and Trustees Executors Limited as Trustee. This is a first ranking security. The benefit of this security has been given to certain investors and others, and it can be given to new investors.
Auckland Council's powers to set, access and collect rates are reflected in the credit quality of Auckland Council:
|Standard & Poor's (Australia) Pty Limited
|| AA/Outlook Stable
|Moody's Investor Services Pty Limited
||Aa2/ Outlook Stable
|| Aa2/ Outlook Stable
Auckland Council group debt at 30 June 2012 was $5.03 billion. The Long-Term Plan notes that group debt is expected to increase to reach a peak of $12.5 billion in 2021/2022.
Auckland Council's main funding sources are the domestic market (both retail and wholesale), the Local Government Funding Agency and offshore markets.
Auckland Council has five issues of fixed-rate retail bonds listed on the NZX Limited Debt Market (NZDX).
Offshore Bond Investors
The Local Government (Auckland Council) Act 2009 was amended in September 2011 to allow Auckland Council to borrow in foreign currency. Council established a US$2.5 billion Secured Medium Term Notes Programme on 30 November 2011, allowing multi currency borrowings in offshore markets.