TCV Issuance Practices

TCV is the central financing authority and financial adviser to the State of Victoria. TCV's funding activities are undertaken to provide its borrowing clients with required liquidity and flexibility.

To achieve this, TCV maintains four funding programmes:

  • AUD Domestic Bond Programme
  • Euro Medium Term Note Programme
  • Domestic Promissory Note Programme
  • Euro Commercial Paper Programme.

TCV is a frequent borrower and the majority of its term funding is sourced from the AUD Domestic Bond Programme via TCV's Fixed Income Dealer Panel (the Dealer Panel). The members of the Dealer Panel are governed by a dealer agreement under which they agree to:

  • commit to the orderly distribution of TCV bonds to investors
  • promote TCV bonds to investors in conjunction with the stated objectives of TCV
  • on a best endeavour's basis make markets to the panel and to investors
  • encourage secondary market activity in TCV bonds and offer investors access to secondary market liquidity on a competitive and ongoing basis in accordance with existing market conventions. This includes the making of markets in TCV bonds and the display of indicative prices at which the dealer may be prepared to deal on appropriate dealing screens.

To ensure that the Dealer Panel functions effectively, TCV will:

  • inform the market of its anticipated issuance requirement for each financial year and inform the market on a timely basis of its progress against the funding task and any material changes to the total TCV funding programme
  • provide a level of liquidity to the Dealer Panel to assist the dealer's market making commitments
  • provide a level of liquidity to the dealers to help manage their open positions as a result of their market making commitments to investors
  • publish daily updates of amounts on issue on (i) Bloomberg page TCVA and (ii) Refinitiv page TCVM.

TCV employs three issuance methods to maximise its access to funds, diversify its investor base and enhance liquidity in its bonds:

Syndication is used primarily to launch new bond issues.

Tenders are offered regularly via the Yieldbroker DEBTS system. The timing, size and specific securities to be tendered are usually, but not always, advised to markets after the close of trading for the next business day. Tenders allow TCV to fund in smaller volumes in the primary market compared with larger syndications. Bids are submitted via TCV's Dealer Panel.

Reverse enquiry is an important method of funding for TCV. It allows TCV to respond to investor demand in the size and maturity that investors are seeking. This flexible issuance approach is particularly important when meeting the needs of offshore investors as well as being able to respond to enquiries from domestic real money and bank balance sheets. Reverse enquiry is the most efficient method of aligning the demand from TCV's borrowing clients with the demand from its global investor base,