NAB Capital Notes 3 - Completion of Bookbuild & Margin Set

On Friday, NAB announced that its NAB Capital Notes 3 offer (NABPF) will raise at least A$1.65 billion and confirmed that the margin has been set at 4.00% over the 90-day Bank Bill Swap Rate (BBSW) - at the lower bound of the guided range (4.00 – 4.20%). Following (expected) strong demand, the Bookbuild has been closed and final size awaits the closure of Reinvestment and Securityholder Offers on 14 March 2019. We would not be surprised if this deal finally issued around $2 billion, which we view as a very mild credit negative from NAB’s perspective given peer banks have decided to structure their AT1 profiles with more frequent and generally smaller Notes.

National Australia Bank (NAB) on 15 February announced that it had allocated $1.65 billion of NAB Capital Notes 3 under the Broker Firm and Institutional Offers and closed the Bookbuild earlier than expected.

The Margin has been set at 4.00% per annum, at the bottom of the guided Margin range of 4.00 - 4.20%.

The final size of the Offer will depend on the volume of applications received and accepted under the Reinvestment and Securityholder Offers, which opens on 19 February 2019.

A replacement prospectus is scheduled to be lodged with ASIC on 19 February 2019.