Investor Centre
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 |
November 2012 |
AA/Outlook Stable |
AA/Outlook Stable |
A-1+ |
| Moody's Investor Services Pty Limited |
November 2012 |
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.
Retail investors
Auckland Council has five issues of fixed-rate retail bonds listed on the NZX Limited Debt Market (NZDX).
|
Amount |
$27.815 million |
$150 million |
$350 million |
$95.792 million |
$350 million |
$125 million |
|
|
|
Coupon interest rate |
6.15% |
6.42% |
6.28% |
6.90% |
6.52% |
4.41% |
|
|
|
Issue date |
30 September 2009 |
24 March 2009 |
24 March 2010 |
30 September 2009 |
29 September 2010 |
18 December 2012 |
|
|
|
Maturity date |
15 September 2013 |
24 March 2014 |
24 March 2015 |
15 September 2015 |
29 September 2017 |
18 December 2018 |
|
|
|
Interest payment dates |
March and September |
March and September |
March and September |
March and September |
March and September |
June and December |
|
|
|
NZDX ticker |
AKC030 |
AKC010 |
AKC020 |
AKC040 |
AKC050 |
AKC060 |
|
|
These bonds are debt securities that pay a fixed rate of interest (coupon) and mature at a fixed time in the future (maturity date). Bonds issued prior to 1 November 2010 were originally issued to the public by either Auckland City Council or Manukau City Council and Auckland Council took over all the obligations relating to the bonds on that date. The bonds are secured by the first ranking charge over all of Auckland Council's rates and rates revenue.
This page provides current and potential investors with information about the bonds and links to key financial information and reports.
Your bonds
How to buy or sell retail bonds
Auckland Council Treasury recommends you talk to an authorised financial adviser with any questions you have about whether you should buy, sell or continue to hold retail bonds.
Current trading price of Auckland Council bonds
See the NZX website for the current trading price and market announcements.
Interest payment dates
Interest on the bonds is payable twice annually in arrears, in two equal instalments, each year up to and including the maturity date. Refer to the above links to find out the next interest payment date for each of the bonds.
Changed your address or bank account?
If you are a current bond holder and have recently changed your address or bank account, visit the Computershare website to update the registry.
Complaints
Any complaints about Auckland Council's retail bonds can be made using our standard complaints process.
Auckland Council is a member of the Financial Disputes Resolution Scheme (FDR Scheme). The FDR Scheme is operated by Dispute Resolutions Services Limited (DRSL). If you cannot agree with Auckland Council on how to resolve your issue, you can refer the matter to DRSL by directing it to:
DRSL
Level 9
109 Featherston Street
Wellington 6011
Attention: Manager, FDR
Telephone: 0508 337 337
Facsimilie: 04 918 4901
Wholesale Investors
Domestic wholesale investors provide around 60 per cent of Auckland Council's debt funding. These include large institutional investors, banks, insurance companies, KiwiSaver providers and fund managers.
Auckland Council’s borrowing from the wholesale market is undertaken via a Medium Term Notes programme for long term borrowings and Commercial Paper programme for borrowings of less than a year. Both programmes are for wholesale investors only and are secured by the charge over Auckland Council's rates and rates revenue.
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.
If any bonds are listed, they will be listed on the
Singapore Stock Exchange. Auckland Council undertook its first issue in March 2012.
All borrowings under the programme are fully hedged to eliminate foreign currency fluctuations. Offshore investors, like domestic investors, receive as security the benefit of the charge over Auckland Council’s rates and rates revenue.