Hybrids 19 Oct – 23 Oct 2015

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AMP capital notes final margin

Demand for AMP’s new capital notes in the institutional book-build process has seen the issue upsized from an indicated $200m to at least $230m. The margin has been fixed at the lower end of the initial indicated range at 5.10% above the 90 day BBSW rate. This margin is fixed for the life of the notes with the BBSW rate reset each quarter.

Total return for the first quarter will be around 7.20% including a franking component based on an 85% franking rate.

The $230m is the amount allocation to brokers and institutional investors with the final issue size determined by the shareholder and retail allocation. The PDS for the issue can be found at www.ampcapitalnotes.com.au

STOP PRESS: AMP new hybrid issue

AMP is seeking to raise $200m in Additional Tier 1 capital through a new hybrid issue. The issue is expected to pay 3 month BBSW plus a margin of 5.10% to 5.30% including franking of 85%. The final margin will be set in a bookbuild process.

In hybrid trading this week, some of the lower margin non-bank subordinated note trading margins have rallied, however AGLHA, GMPPA and CTXHA have traded sideways. The current margins are still well off their 6 month lows, whereas CNGHA, TAHHB and AQHHA are at their 6 month lows.

Hybrids 12102015

Major Basel III bank trading margins are represented above.

Crown resorts gave a trading update last week and the Crown debt margins are shown below. Margins widened in mid-September in response to the 2019 senior bond’s gradual margin rise and a weak Crown share price but listed margins have since recovered generally. The CWNHB margin has widened this week after a quick dip below CWNHA’s margin.

Hybrids 12102015 – 02


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COMPANYCODEHYBRID
TYPE
MATURITY
OR STEP-UP
DATE
MARGIN
INC FRANK
TRADING
MARGIN
∆ WEEKWEEK
CLOSE
YTM
Est**
ANZ Banking GroupANZPAMCPS I16/12/20163.10%3.30%0.10%100.305.46%
ANZ Banking GroupANZPCMCPS II28/09/20173.10%3.55%0.10%99.935.77%
ANZ Banking GroupANZPDMCPS II1/09/20213.40%4.40%-0.20%96.006.62%
ANZ Banking GroupANZPECapital Note24/03/20223.25%4.75%-0.08%92.806.97%
Bendigo BankBENHBPerpetual21/10/20541.00%2.79%0.16%72.144.95%
Bendigo BankBENPDMCPS II13/12/20175.00%3.91%-0.21%104.706.13%
Bendigo BankBENPEMCPS II30/11/20203.20%4.84%-0.02%95.207.06%
Bendigo BankBENPFMCPSII15/06/20214.00%4.92%-0.20%98.007.14%
Bank Of QueenslandBOQPDMCPS II16/04/20185.10%3.26%-0.39%104.355.48%
CBA PERLS 3PCAPAStep Up6/04/20161.05%3.26%0.10%198.275.42%
CBA PERLS 6CBAPCMCPS II15/12/20183.80%3.88%-0.06%100.386.04%
CBA PERLS 7CBAPDMCPS II15/12/20222.80%4.81%0.00%89.406.97%
ChallengerCGFPACapital Note25/05/20203.40%4.92%0.02%95.007.08%
IAGIAGPCMCPS II1/05/20174.00%3.71%0.10%100.235.93%
IAG RESIANGReset pref16/12/20194.00%4.16%-0.14%101.606.32%
Macquarie BankMBLHBIncome SecPerpetual1.70%3.93%0.04%69.506.09%
MacquarieMBLPACapital Note24/03/20203.30%4.36%-0.20%95.506.58%
MacquarieMQGPACapital Note19/06/20184.00%4.25%0.05%101.126.47%
Multiplex SITESMXUPAPerp'l PrefPerpetual3.90%5.90%-0.10%77.998.06%
Nat Aust BankNABHAIncome SecPerpetual1.25%3.47%0.00%68.405.63%
Nat Aust BankNABPAMCPS II20/03/20193.20%4.45%-0.01%96.656.61%
Nat Aust BankNABPBMCPS II17/12/20203.25%4.65%0.03%94.516.81%
NufarmNFNGStep UpPerpetual3.90%5.48%0.02%81.957.70%
PaperlinxPXUPAPerp'l Pref30/06/2052N/A8.80%0.00%14.0011.02%
Ramsay Health CareRHCPAPerp'l PrefPerpetual4.85%4.61%-0.04%103.106.83%
Suncorp-MetwaySBKHBIncome SecPerpetual0.75%2.11%-0.01%76.924.27%
SuncorpSUNPCMCPS II17/12/20174.65%3.27%-0.40%103.425.43%
SuncorpSUNPEMCPS II17/06/20203.40%4.31%-0.14%96.906.47%
Seven Network TELYS 4SVWPAPerp'l Pref2/12/20544.75%8.65%-0.19%69.3010.87%
WestpacWBCPCMCPS II31/03/20183.25%3.61%-0.13%99.505.83%
WestpacWBCPDMCPS II8/03/20193.20%4.41%-0.12%96.996.57%
WestpacWBCPEMCPS II23/09/20223.05%4.60%-0.23%92.006.76%
WestpacWCTPAStep Up30/06/20161.00%3.19%-0.81%98.705.35%

** YTM for floating rate securities is an estimate using current interest rates. This will vary if rates change.
Source: Evans & Partners. Dealing Contact Michael Saba +61 3 9631 9813

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