Kiwibank's borrowing $650 million through a five-year retail bond issue that'll pay investors an annual interest rate of 6.254%.
That interest rate is significantly higher than the 5.10% and 5.20% carded, or advertised, five-year term deposit rates Kiwibank offers.
The unsecured, unsubordinated fixed rate medium term notes are direct, unconditional and unsecured obligations of Kiwibank. They'll be issued on Thursday, October 19, and mature five years later.
The bonds were priced at a margin of 1.10% per annum over the swap rate.
Kiwibank launched the offer saying it was seeking to borrow $100 million "plus unlimited over-subscriptions." The bonds won't be listed on the NZX debt market.
It's Kiwibank's biggest ever retail bond offer alongside one from a year ago. In October 2022 the bank also borrowed $650 million through a five-year bond issue. That one pays investors an annual interest rate of 5.737%.
The new offer's arranger was Westpac, and its joint lead managers were ANZ, BNZ, ASB's parent Commonwealth Bank of Australia and Westpac.
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