Westpac Banking to offer A$600 million five-year convertibles to yield 2.3%-2.8%

By Rebecca Melvin

New York, June 18 - Westpac Banking Corp. has launched a A$600 million offering of hybrid Tier 1 securities, to be known as Westpac stapled preferred securities, that were talked to yield 2.3% to 2.8%, according to a news release.

The Westpac preferreds qualify as non-innovative residual Tier 1 capital and will be listed on the Australian Securities Exchange.

The issue is not connected to the proposed merger with St. George Bank Ltd. and is expected to be completed by the end of July before the proposed merger has been implemented, the release stated.

The stapled securities will be issued by Westpac, consisting of a Westpac preference share, stapled to a subordinated note issued by Westpac's New York branch, and are expected to be rated A+ by Standard & Poor's and Aa3 by Moody's Investors Service.

The offer is expected to open June 26, with closing on the security holder offer on July 23 and closing on the broker firm offer on July 28.

Trading is expected to begin on July 31.

Based in Sydney, Australia, Westpac is a financial services company.

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