Kiwibank says its sister company, Kiwi Capital Funding Limited, is considering borrowing $150 million from the public through an issue of perpetual capital notes.
Proceeds raised would be used as capital to meet Kiwibank's Reserve Bank enforced Basel III regulatory requirements.
The issue plans come with a BBB rated, $150 million capital security issue from another Kiwibank affiliate, Kiwi Capital Securities, due to mature on May 4. It's paying investors a coupon of 8.15%.
"The perpetual capital notes are perpetual, non-cumulative, unsecured, subordinated securities. The perpetual capital notes will not be guaranteed by Kiwibank, the Government or any other person," Kiwibank says.
"It is expected that the offer of perpetual capital notes will be made in mid April 2015. The initial interest rate and the margin will be announced on or before the offer opens."
Joint lead managers of the offer are Deutsche Craigs, Forsyth Barr and Macquarie, indicating it'll be targeted at retail investors.
Kiwi Capital Funding Ltd was established solely for the purpose of issuing debt securities and using the proceeds to subscribe for regulatory capital instruments issued by Kiwibank.
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