Kiwibank borrows NZ$309 mln from Australian savers
15th Oct 09, 12:08pm
Kiwibank said it had borrowed NZ$309 million (A$250 million) from Australian savers through a 5 year bond issue offering 6.25%. This is the first time Kiwibank has raised funds on overseas wholesale markets and was foreshadowed in August when Kiwibank announced its results. It said then that hot competition for funds locally from the big 4 Australian banks had forced it offshore. Kiwibank's advertising campaigns focus on its differences with the Australian banks and how it doesn't depend on Australia for its support or has to send profits to Australia. Here is the full statement from Kiwibank below.
Kiwibank has successfully raised $A250 million ($NZ309 million) through a bond issue in Australia. This is the bank's first entry into the international wholesale bond market since the bank was launched in 2002. The bank made presentations to investors last week, seeking to raise a minimum of $A200 million. The bond offer closed yesterday morning. The $A250 million raised is priced at a margin of 42 basis points over bank bill swap rates. The bonds are guaranteed by the bank's parent, New Zealand Post Limited, and are provisionally guaranteed by the New Zealand Government under the Crown Wholesale Funding Guarantee Scheme. A final Guarantee Eligibility Certificate for the bonds is expected to be issued in the next few days. The bonds are expected to be rated as Aaa by Moody's and AA+ by Standard & Poor's. HSBC was lead manager on the issue with co-managers RBS and UBS. Kiwibank Treasurer Richard Schofield described the successful issue as "a significant and landmark transaction as it represents the bank's first public debt raising offshore".