Kiwibank Limited announces subordinated note offer


Kiwibank Limited (Kiwibank) has today announced an offer of up to $275 million of unsecured subordinated loss absorbing notes (Subordinated Notes) to New Zealand investors. The offer will raise Tier 2 Capital to help Kiwibank meet its regulatory capital requirements.

The Subordinated Notes have a maturity date of 11 December 2030 but may be redeemed early, if certain conditions are met, from 11 December 2025 or earlier for tax or regulatory reasons. The Subordinated Notes have a credit rating of Baa3 from Moody’s Investors Service, reflecting their subordination and loss absorption features.

The initial interest rate, which applies for the first five years, will be the sum of the margin plus the five year swap rate. The indicative margin range for the Subordinated Notes is 1.90% to 2.05% per annum. The actual margin may be above or below the indicative margin range.

The margin and the initial interest rate will be set following a bookbuild process on 4 December 2020 and will be announced by Kiwibank shortly thereafter and available at On 11 December 2025, if the Subordinated Notes have not been redeemed early on that date, the interest rate will be reset by adding the margin to the five year swap rate as at that date. Payments on the Subordinated Notes are subject to Kiwibank satisfying a solvency condition.

The offer will close on 4 December 2020 following the bookbuild process, with the Subordinated Notes expected to be issued on 11 December 2020.

Details of the offer and the Subordinated Notes are contained in the Limited Disclosure Document, available on the online Disclose Register maintained by the Companies Office ( offer number OFR13006) or by contacting one of the Joint Lead Managers to the offer (listed below) or your usual financial adviser.