OPERATIONAL NOTICE
No: 11/2003
UNWIND OF COMMONWEALTH CROSS CURRENCY SWAP PORTFOLIO
Following a review, the Australian Office of Financial Management (AOFM) commenced in September 2001 a phased reduction of the foreign currency exposure in the Commonwealth debt portfolio to zero. The reduction is nearly two thirds complete.
As a result, the AOFM intends to explore the potential for early termination
of remaining cross currency swaps. Consequently, the AOFM will invite
counterparties to negotiate terms for the early termination of swaps.
At this stage it is intended to consider early termination only in respect
of swaps scheduled to mature after end-June 2004.
Early termination of swaps will only proceed if mutually acceptable terms
are agreed. Otherwise the rundown will be managed, as has been the situation
to date, through forward foreign exchange contracts.
Contact: Gerald Dodgson
Telephone: +61 2 6263 1141