New Issue: ME Bank Limited Wholesale Capital Notes

On the 14th November 2017 Members Equity Bank Limited (ME Bank / ME) announced a new issue, Members Equity Wholesale Capital Notes [ISIN: To Be Confirmed].

The notes are expected to be issued on the 28th November 2017 and the offer is expected to raise up to $150 million (with the ability to raise more or less).

These securities are structured as perpetual, unsecured, subordinated and fully paid notes to meet APRA's criteria as Additional Tier 1 (AT1) capital.  Distributions are floating rate, quarterly, discretionary, non-cumulative and are expected to be fully franked.

Current margin guidance is 3mBBSW +525bps area (which may be revised) and coupon payments are payable quarterly in arrears.

This security has no fixed maturity date but is callable on the 28 November 2022 and each coupon payment date after that date, subject to APRA's prior written approval and meeting the Notes' terms.

This security meets the new capital instrument eligibility criteria under Basel III and also contains the Loss Absorbing Event term referred to in the Information Memorandum as a Non-Viability Trigger Event.  There is no Capital Trigger Event incorporated into this note, meaning that there is no possible conversion into ordinary shares, only "write-off", after which, should this occur, all holders' rights will be terminated.