On Wednesday 20 March 2019, NAB closed the NAB Capital Notes 3 offer and issued 18,740,582 securities at $100 each, raising $1.874 billion.
The Group also announced that all Convertible Preference Shares (CPS) issued six years ago had been resold to the CPS nominated purchaser and following this, $750 million of CPS were converted into 30,185,463 Ordinary Shares based on a price of $24.8464. This was in accordance with NAB's earlier stated intentions and results in a boost of 19 basis points to the Group's Level 2 Common Equity Tier 1 capital ratio. The remaining $764 million CPS were redeemed.
As we expected (and particularly so after very keen Broker Firm, Institutional Offers and the MQGPD launch), Securityholder scale-backs were enforced with the first $30,000 being accepted in full and only 20% of amounts in excess of this. All Reinvestment Offer applications were accepted in full.
We view the boost to NAB's CET1 positively and especially so given the increasing difficulty in organically adding to this whilst maintaining absolute dividend payouts per share.
The Issue Date VWAP was set at $25.0247 and the Maximum Conversion Number at 19.9803 Ordinary Shares per NAB Capital Note 3.
The Distribution Rate for the first Distribution Period was set at 4.0740% and equates to a Distribution of $0.9934 per Note on 7 June 2019.