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Kiwi to offer NZ$100 million subordinated bonds from May 15 to June 3
By Susanna Moon
Chicago, May 5 - Kiwi Capital Funding Ltd. is offering up to NZ$100 million of unsecured subordinated capital notes to the New Zealand public, with proceeds to be used to invest in convertible subordinated bonds to be issued by Kiwibank Ltd., according to a press release.
The offer is expected to run from May 15 to June 3.
The returns on the capital notes will be derived from the performance of the convertibles issued to Kiwi Capital by Kiwibank.
The capital notes' margin and interest rate for the first five years until July 15, 2019 will be set following a bookbuild on May 14.
The capital notes will be due July 15, 2024 but may be called from July 15, 2019 and earlier for tax or regulatory reasons.
The capital notes have a credit rating of BB+ from Standard & Poor's, reflecting their subordination and loss-absorption features, the release noted.
Kiwi Capital said on April 28 that it was considering a public offering of up to NZ$100 million of subordinated capital notes with proceeds to be used to invest in Kiwibank's convertibles, which would help Kiwibank meet its regulatory capital requirements under the Reserve Bank's Basel III framework.
The capital notes will not be guaranteed by Kiwibank or its parent company, New Zealand Post, or any other person.
Deutsche Craigs Ltd. and Forsyth Barr Ltd. are the joint lead managers.
The company expected to conduct the offer in the week beginning May 5.
State-owned New Zealand Post provides banking services through its post offices and outlets throughout New Zealand. Kiwibank is also owned by the New Zealand government. The companies have headquarters in Wellington, New Zealand.
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