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Local government contemplates new bond

NZ Newswire logoNZ Newswire 16/03/2017 Rebecca Howard

The agency that sells bonds on behalf of New Zealand's local authorities is looking at issuing a new long-dated bond in early April.

The New Zealand Local Government Funding Agency, is contemplating a new April 14, 2033 bond at the next tender scheduled for April 5, it said in a statement to the stock exchange.

More information would be provided next month.

A new 2033 bond will allow LGFA to provide long-dated funding to New Zealand councils to better match their assets, it said.

As at February 20, the LGFA had $7.28 billion of bonds on issue, including $300 million of Treasury stock.

A 2033 bond would be the LGFA's longest dated bond.

The LGFA was established in 2011 to reduce local authority borrowing cost and began issuing bonds in 2012.

It has a domestic currency credit rating of AA+ with Standard & Poor's, the same rating as the New Zealand government.

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