NAB came to the Australian market with a huge senior unsecured bond issue late last week.
The transaction was NAB’s largest ever in its home market and equals the third-largest Australian dollar print by a big-four bank. The bank raised AU$4 billion and received bids of around $5 billion, not satisfying demand.
There were four tranches, a fixed and floating for three and five years.
CBA was the first to launch in 2022 with Westpac not far behind in January. Those banks paid 70 basis points over swap for five year funding. NAB paid slightly more at 72 basis points, but in line with current market expectations. Three year bonds priced at 47 basis points over swap.
Interestingly, the deal launched without the three year fixed rate tranche but reverse enquiry saw NAB add the tranche.
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The other point to note was that the bank decided to execute the trade intra-day to avoid global market volatility.
Asian investors took up more than half of both five year tranches. Other banks keenly sought both floating rate deals, while asset managers took large chunks of the fixed rate tranches.
