Rabobank is the latest bank to hit the market with a seven-year bond offer, seeking up to NZ$250 million in a retail offer that will pay a minimum interest rate of 6.10%.
Rural lender Rabobank said it's launching a public issue of unsecured, unsubordinated medium term notes seeking NZ$100 million plus potential oversubscriptions of NZ$150 million. The money raised will be used for "general corporate purposes."
"The Notes will have a term to maturity of seven years and include a minimum interest rate of 6.10 percent per annum," Rabobank said. "The final interest rate will be set on the rate set date of March 14, 2012 and will be set at the higher of 6.10% per annum or the Benchmark Rate (the seven-year swap rate currently 4.18%) plus 1.90% per annum as at that date "
The Rabobank offer comes after BNZ raised NZ$200 million in a seven-year bond offer in December at 6.10% and with an ANZ seven-year offer, also seeking up to NZ$250 million and paying a minimum interest rate of 6.25% now open and receiving strong demand.
ANZ and BNZ have been appointed as joint lead managers of the Rabobank issue with Craigs Investment Partners as co-manager.
Rabobank lost its triple AAA Standard & Poor's credit rating in December when S&P changed its ratings system. However, the bank's new AA rating, two notches below AAA, is higher than the AA- ratings the credit rating agency has on ANZ NZ, ASB, BNZ, Westpac NZ and Kiwibank.
Rabobank already has a range of bonds on issue in New Zealand. See its bond issuer pages here, here and here. The issuer in this latest offer is Rabobank Nederland New Zealand Branch.
The offer opens today and closes on Wednesday March 14, which is also the rate set date. The bonds will be issued on March 19 and are due to mature on March 19, 2019. Investors' must stump up a minimum of NZ$10,000. Rabobank's online bank, RaboDirect, currently advertises a 6% interest rate on five-year term deposits.
See Rabobank's Investment Statement here and Terms Sheet here.
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