IFR 03.08.2019

ûBYûANUARYûû ûPRIMARILYûVIAû4IERûû
INSTRUMENTS
4HEûREGULATORûANDûTHEûFOURûBANKSû
ESTIMATEDûTHISûWILLûRAISEûTHEûTOTALûSTOCKûOFû
OUTSTANDINGû4IERûûCAPITALûBYûAûNETû!BNû
53BN 
.!"ûSAIDûITûREQUIREDûANûADDITIONALû
!BNûTOûMEETûTHEûlNALû!02!ûRULES û
BEFOREûLASTû-ONDAYSûSUPPLYû4HEûRESPECTIVEû
TOTALSûFORû!.:ûANDû7ESTPAC ûPRIORûTOûTHEIRû
ULYû4IERûûISSUES ûWEREû!BNûANDû!BN û
WHILEû#OMMONWEALTHû"ANKûOFû!USTRALIAû
NEEDSû!BN
(OWEVER û-OODYSûESTIMATESûANûAGGREGATEû
CAPITALûINCREASEûOFû!BNnBNûWASû
REQUIRED ûASûOFû-ARCHûû ûTOûACHIEVEûAû
nûCAPITALûBUFFER ûAFTERûTAKINGûINTOû
ACCOUNTûAûPROJECTEDûûANNUALûINCREASEûINû
27!ûANDûTHEûREPLACEMENTûOFû!BNûOFû
OUTSTANDINGûCAPITALûSECURITIESûTHATûWILLû
MATUREûBYûûORûBEûNOûLONGERûTREATEDûASû
REGULATORYûCAPITAL
4HEûRATINGûAGENCYûALSOûESTIMATESûTHAT ûOFû
THISûTOTAL ûAûMINIMUMûOFûAROUNDû!BNû
WOULDûNEEDûTOûBEûMETûTHROUGHû!DDITIONALû
4IERûûSECURITIESûGIVENûMINIMUMûPRUDENTIALû
REQUIREMENTSûFORû!4ûCAPITAL
-OODYSûSEESû#"!ûWITHûTHEûSMALLESTû
ADDITIONALûCAPITALûREQUIREMENTûRANGEûOFû
!BNnBNûFOLLOWEDûBYû!.: û
7ESTPACûANDû.!"ûWITHû!BNnBN û
!BNnBNûANDû!BNnBN û
RESPECTIVELY
4HESEûTOTALSûAREûBEFOREûTHEûRECENTû
53BNû7ESTPAC û!BNû!BNûNET û
!.:ûANDû53BNû.!"û4IERûûISSUESûASûWELLû
ASûAû.!"û!BNû
YEARûNON
CALLûlVEûNOTEû
SOLDûINûEARLYû-AY
-OODYSûEXPECTSûTHEûBANKSûTOûFOCUSûONûTHEû
53ûDOLLAR û!USTRALIANûDOLLARûANDûEUROûFORû
THEIRû4IERûûNEEDS
h7EûBELIEVEûTHEû53ûDOLLARûMARKETûWILLû
REPRESENTûAûGREATERûPROPORTIONûOFûFUTUREû4IERûû
CAPITAL ûGIVENûTHEûGREATERûDEPTHûRELATIVEûTOûTHEû
DOMESTICûMARKETûANDûTHEûHIGHERûISSUINGû
VOLUMESûTHATûWILLûBEûREQUIRED vû-OODYSûSAID
/FûTHEûOUTSTANDINGûMAJORûBANKû4IERûû
SECURITIES ûûAREûINû53ûDOLLARS ûûINû
!USTRALIANûDOLLARSûANDûûINûEUROS û
ACCORDINGûTOû-OODYS
4HEû*APANESEûYENûISûNEXTûWITHûANûûSHAREû
OFûOUTSTANDINGû!USTRALIANûMAJORûBANKû4û
SECURITIES ûFOLLOWEDûBYûTHEû.EWû:EALANDû
DOLLAR û3INGAPOREûDOLLAR û#HINESEûRENMINBIû
ANDû(ONGû+ONGûDOLLARûWITHû û ûûANDû
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EUROS

BANK OF AMERICA BREAKS FIG SILENCE
WITH POST-FED SENIOR

BANK OF AMERICA CORPORATIONûSTIRREDûAûMARKETû
THATûHADûSEEMEDûDORMANTûLASTû4HURSDAYû

WITHûAûõBNû

YEARûNON

CALLûNINEûHOLDCOû

SENIORûISSUEûWHICHûATTRACTEDûõBN

PLUSû

DEMANDûEVENûAFTERû7EDNESDAYSû&EDû

RHETORICûFAILEDûTOûLIFTûMARKETS

"ANKûOFû!MERICASûDEALûWASûTHEûlRSTûEUROû

BENCHMARKûBONDûFROMûAûlNANCIALûSINCEû*ULYû

ûWHENû*0û-ORGANûITSûCOMPATRIOTûSOLDûAû

õBNû.#ûSENIORûTRADE

4HEûISSUEûALSOûCAMEûAFTERûTHEû&EDERALû

2ESERVEûDELIVEREDûANûEXPECTEDûBPûRATEûCUTû

BUTûDISAPPOINTEDûTHEûMARKETûASûCHAIRMANû

*EROMEû0OWELLûSIGNALLEDûAûSERIESûOFûFURTHERû

CUTSûWASûUNLIKELY

4HEûMOVEûPROMPTEDûSOMEûVOLATILITYûINû53û

BANKSûEQUITYûPRICESûLASTû7EDNESDAYûWITHû

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LIQUIDITYûOVERûTHEûLASTûTWOûWEEKSûNOTINGû

CORPORATEûISSUERSûHADûCONTINUEDûTOû

SUCCESSFULLYûTAPûTHEûMARKET

(EûSAIDûTHEûBANKûALSOûKEPTûAûCLOSEûEYEûONû

THEûIMPACTûOFûTHEû&EDûDECISIONûDESCRIBINGû

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ASûhPRETTYûMODESTvûANDûWAITEDûTOûOBSERVEû

THEû%UROPEANûOPENûBEFOREûGOINGûAHEAD

3OLEûBOOKRUNNERûBank of America Merrill

Lynch MARKETEDûTHEû!UGUSTûûNON

CALLû

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INITIALûPRICEûTHOUGHTSûOFûMID

SWAPSûPLUSû

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BPûAREAûBEFOREûTHEûSPREADûWASûlXEDûATû

BPûANDûTHEûSIZEûATûõBNû"OOKSûCLOSEDûINû

EXCESSûOFûõBN

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BP

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CURVE

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CALLû!PRILûûHOLDCOû

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QUOTEDûATûBP

4HEûBANKERûCLOSEûTOûTHEûTRADEûSAIDûTHEû

SMALLûSIZEûOFûTHEûNEWûISSUEûPREMIUMû

COMPAREDûFAVORABLYûTOûTHOSEûPAIDûBYû

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4HURSDAYû4HEû53ûCORPORATEûWASûSEENûTOûBEû

PAYINGûCONCESSIONSûOFûUPûTOûBP

h&ORûUSûTOûGETûõBNûDONEûWITHûAûBP

BPû

PREMIUMûISûAûPRETTYûFANTASTICûRESULTvûHEû

SAID

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RIP

ROARINGûBACKDROPûASûWELLvûHEûSAIDûh4HEû

&EDûWASûMARGINALLYûDISAPPOINTINGûYOUVEû

GOTûNONFARMSûTOMORROWûANDûYOUVEûGOTû

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DECIDINGûTOûENTERûTHEûMARKETûINûSPITEûOFû

THOSEûOBSTACLESûIFûTHEYûEXPECTûHEAVYûSUPPLYû

ANDûVOLATILITYûINû3EPTEMBER

4HEûDEALûISûEXPECTEDûTOûBEûRATEDû!!

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-OODYS30&ITCH  

NON-CORE CURRENCIES

LLOYDS BANK KANGAROO RAISES A$700m

LLOYDS BANKû!A!!  ûFAILEDûTOûGETûMUCHû

TRACTIONûONûAûTHREE

YEARû+ANGAROOûBONDû

OFFERINGûTHATûWASûPRICEDûLASTû&RIDAYûAGAINSTûAû

DIFlCULTûMARKETûBACKDROPûINûCOMPARISONû

WITHûMOREûFAVOURABLEûCONDITIONSûEARLIERûINû

THEûWEEK

4HEû5+ûLENDERûRAISEDû!Mû53M    û

FROMûTHEûDUAL

TRANCHEûSENIORûUNSECUREDû

SALEûARRANGEDûBYûANZûMizuhoûNABûRBC ANDû

Westpac

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RATEûNOTEûTRANCHEûONLYû

MATCHEDûGUIDANCEûINûTHISûCASEûTHREE

MONTHû

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!MûTAPûOFûITSûû!UGUSTûûû

BONDS

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RATEû

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YEARûSALE

4HESEûBONDSûCOUNTûTOWARDSûTHEûGROUPSû

TOTALûLOSS

ABSORBINGûCAPACITYûORûINûTHEû%5û

JURISDICTIONûMINIMUMûOWNûFUNDSûANDû

ELIGIBLEûLIABILITIESû-2%,  

5NDERû5+ûRULESûHOLDINGûCOMPANIESûCANû

ISSUEû4,!#-2%,

ELIGIBLEû+ANGAROOSûTHOUGHû

THEYûAREûSUBJECTûTOû!USTRALIANûLAW

BANK DUO LOCK IN TIGHT SPREADS

4WOûBANKSûLOCKEDûINûTHEûLOWESTûCREDITû

SPREADSûINû!USTRALIAûSINCEûTHEûGLOBALû

lNANCIALûCRISISûLASTûWEEKûWITHûDUAL

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SWEETûSPOT

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RATEDû!!û-OODYS30 ûISSUEDûAû!BNû

53M    ûTWO

PARTûlVE

YEARûSENIORû

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PREVIOUSûSALEûOFû!MûOFûTHREE

YEARûNOTESû

INû&EBRUARYûCOMPRISEDû!MûOFûmOATING

RATEûNOTESûPRICEDûINSIDEûBPûAREAûGUIDANCEû

ATûTHREE

MONTHû""37ûPLUSûBPûALONGSIDEû

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RATEûNOTESûPRICEDûATû

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ASSETûSWAPS

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ACCORDINGûTOûLOCALûSYNDICATIONûMANAGERS

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