By Susanna Moon
Chicago, May 14 - Kiwi Capital Funding Ltd. priced its offering of NZ$100 million of unsecured subordinated capital notes following a bookbuild on Wednesday.
The margin was set at 215 basis points, and the coupon will be 6.61% for the first five years until the reset date of July 15, 2019.
As previously announced, Kiwi Capital is offering the capital notes to the New Zealand public, with proceeds to be used to invest in convertible subordinated bonds to be issued by Kiwibank Ltd.
The returns on the capital notes will be derived from the performance of the convertibles issued to Kiwi Capital by Kiwibank.
The offer will run from May 15 to June 3. It was announced May 5.
Investors will be paid early bird interest on the capital notes at 6.61% per year from the time their application money is banked, according to a company press release.
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.
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.
| Issuer: | Kiwi Capital Funding Ltd.
|
| Issue: | Subordinated capital notes
|
| Amount: | NZ$100 million
|
| Maturity: | July 15, 2024
|
| Coupon: | 6.61% until July 15, 2019 reset date; margin is 215 bps
|
| Call option: | From July 15, 2019 and earlier for tax or regulatory reasons
|
| Lead managers: | Deutsche Craigs Ltd. and Forsyth Barr Ltd.
|
| Pricing date: | May 14
|
| Rating: | Standard & Poor's BB+
|
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