The Commonwealth Bank of Australia has announced a new Tier 1 hybrid security, CommBank PERLS XVI Capital Notes.
The offer is expected to raise $750 million but could be more or less than that figure. PERLS XVI are expected to commence trading on 13 June, 2023 under the ASX code CBAPM. The bank said the capital raised will be used to fund CBA’s business.
PERLS XVI are perpetual, subordinated, unsecured notes scheduled to pay floating rate distributions quarterly, which are expected to be fully franked.
Price guidance for the offer is 300-320bp over the three-month BBSW.
The mandatory exchange date is 17 June 2033, with optional call dates: 17 June 2030, 16 December 2030, and 16 June 2031.
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The arranger is Commonwealth Bank of Australia with lead managers: ANZ, Bell Potter, CBA, Morgan Stanley, Morgans, National Australia Bank, Ord Minnett, Shaw and Partners, UBS, and Westpac Institutional Bank.
In accordance with the product design and distribution obligations, investors may not be able to participate in the offer unless they already meet the eligibility requirements and have an existing relationship with a syndicate broker. There is no separate offer to CBA security holders or a general offer for PERLS XVI.
PERLS XVI will qualify as Tier 1 Capital of CBA.
Article Update (18th May, 2023)
CBA in a market update overnight announced that it had brought forward and successfully completed the Bookbuild for the PERLS XVI offer and allocated A$1.55 billion on a firm basis and the margin has been set at 3.00% per annum.
