On the 17th of May 2016 Westpac Banking Corporation (WBC) announced a new transaction, Westpac…
On the 16th of August 2016 Australian and New Zealand Banking Corporation (ANZ) announced a new transaction, ANZ Capital Notes 4 (Prospective ASX Code: ANZPG).
The purpose of this transaction is to provide Regulatory Capital for the group but more specifically it will be treated as additional Tier 1 capital for regulatory purposes. The indicative size of the offer is $1 billion but ANZ retain the ability to change the issue size.
ANZ is offering existing holders of ANZ Convertible Preference Shares 2 (ASX Code: ANZPA) the opportunity to reinvest their capital into this new security through the reinvestment offer but it is also open to new investors.
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Since the ANZ Capital Notes 4 deal was announced on 16th August the Australian major banks hybrid curve has rallied as the trading margin of hybrids with a term of less than 5 years have being sought after.
Figure 1. Tier 1 Capital Note Curve