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Westpac Stapled Preferred Securities (Westpac SPS)

Introduction

The information on this website page is for Australian residents only.
 

Westpac SPS (ASX Code "WBCPA") are no longer trading and were removed from official quotation on 11 September 2013.  Westpac issued 10,362,670 Westpac SPS, at an issue price of A$100 each, raising approximately A$1.04 billion.

Amendments to Westpac SPS terms

On 10 July 2013, Westpac announced amendments to the terms of Westpac SPS to facilitate a Reinvestment Offer for Westpac Subordinated Notes II and related matters.
 

The amended terms are attached together with related documents lodged with the ASX on 10 July 2013:

 

The Reinvestment Offer is now closed.

 

For information about the Reinvestment Offer for Westpac Subordinated Notes II, go to:

Westpac SPS that did not participate in the Reinvestment Offer were transferred to a Nominated Party on 26 September 2013 and holders received $100 per Westpac SPS plus the relevant final distribution. The last day of trading in Westpac SPS on ASX was 11 September 2013. Attached are copies of the Transfer Notice and the Deed

Poll referred to in the Transfer Notice:

What were Westpac SPS?

Each Westpac SPS was a stapled security consisting of a perpetual, unsecured, non-cumulative subordinated Note issued by Westpac's New York branch stapled to a Preference Share issued by Westpac.
 

Westpac SPS were listed on the Australian Securities Exchange (ASX) and could be traded like any other ASX securities. The ASX code for the Westpac SPS was "WBCPA".
 

Further details referred to above on the Westpac SPS are included in the attached amended terms of the Westpac SPS referred to above.

Distributions on Westpac SPS

Westpac SPS offered holders preferred, non-cumulative and floating rate Distributions. Westpac SPS Distributions were fully franked and accordingly investors received a combination of cash distributions and franking credits *. However, your ability to use franking credits will depend on your individual tax position. You should seek professional advice in respect of your individual tax position.
 

Distributions were calculated as follows:
(Distribution Rate x Issue Price x N) divided by 365.
 

The Distribution Rate was a floating rate and was set on the first Business Day of each Distribution Period using the following formula:
(Bank Bill Rate + Margin) x (1 - Tax Rate).  
 

  • The margin was 2.40% per annum
  • The Tax Rate was the Australian corporate tax rate applicable to the franking account of Westpac as at the Distribution Payment Date expressed as a decimal in the formula, 0.30
  • The issue price was $100.00 per Westpac SPS
  • N = the number of days in the Distribution Period
     

The 90 day Bank Bill Rate was set on the first day of each Distribution Period.
 

The Distribution Rate for each Distribution Period was announced to the ASX prior to each quarterly distribution. 

Distribution payment and record dates

Distribution payment date Relevant record date Ex-distribution date
31 December 2012# 21 December 2012 17 December 2012
2 April 2013# 22 March 2013 18 March 2013
1 July 2013 21 June 2013 17 June 2013
29 August 20131 21 August 2013 15 August 2013
26 September 20132 18 September 2013 12 September 2013

# The scheduled Distribution Payment Date was not a Business Day. In accordance with the terms, the Distribution Payment was made on the next Business Day

1. The Distribution payment on 29 August 2013 was a pro-rata distribution payable to all SPS holders, including those who participated in the Westpac Subordinated Notes II Reinvestment Offer.

2. The Distribution payment on 26 September 2013 is the final distribution on Westpac SPS for those who still hold SPS until the record date, 18 September 2013.

Distribution payment history

Distribution Payment Date Distribution rate per annum Cash amount of distribution per Westpac SPS Number of days in the Distribution Period
26 September 2013 3.6453% $0.3495 35
29 August 2013 3.6453% $0.5293 53
1 July 2013 3.8150% $0.9511 91
2 April 2013 3.7870% $0.9338 90
31 December 2012 3.9830% $1.0039 92
2 October 2012 4.1627% $1.0492 92
2 July 2012 4.6620% $1.1623 91
2 April 2012 4.7693% $1.1891 91
3 January 2012 4.9898% $1.2577 92 
30 September 2011 5.1637% $1.3015 92
30 June 2011 5.1018% $1.2720 91
31 March 2011 5.1520% $1.2704 90
31 December 2010 5.0960% $1.2845 92
30 September 2010 5.0680% $1.2774 92
30 June 2010 4.7728% $1.1899 91
31 March 2010 4.5570% $1.1236 90
31 December 2009 4.0273% $1.0151 92
30 September 2009 3.8920% $0.9810 92 
30 June 2009 3.8593%  $0.9622 91  
31 March 2009 4.4100% $1.0874 90 
31 December 2008 6.5520% $1.6515 92
30 September 2008 7.1201% $1.2095 62

How to treat Westpac SPS distributions in your individual tax returns

Investors in Westpac SPS should consult their own professional tax advisers regarding the consequences of acquiring, holding and disposing of Westpac SPS in light of their particular circumstances, including how the distributions should be treated in their tax returns.
 

However, it is expected that for Australian resident investors, while the Notes remain stapled to the Preference Shares, distributions on the Westpac SPS should be treated as non-share dividends and must be included in assessable income.
 

For Westpac SPS investors required to prepare and lodge an individual tax return, the distributions on Westpac SPS should generally be shown as income in the section entitled “Dividends”. The amount of distributions, excluding any franking credits, should be shown as the “Franked amount”. The amount of franking credits attached to the distributions should be shown as the “Franking credit”. In this way, Westpac SPS distributions and any franking credits attached should generally be treated in the same way as dividends and franking credits received on an investment in Westpac ordinary shares.
 

The ATO issued a class ruling on 10 September 2008 that applies to investors who acquired Westpac SPS from the Initial Purchaser under the Prospectus dated 26 June 2008. View a copy of the Class Ruling.

2012 and 2013 income tax returns

This additional information will assist Australian resident individual holders of Westpac SPS in preparing their 2012 and 2013 income tax returns. It is of a general nature only and it is recommended that investors seek their own professional advice on the taxation implications of investing in Westpac SPS.
 

The Westpac SPS distribution together with the attached franking credits for the quarter ended 30 June 2012 was paid on 2 July 2012* and should be included in assessable income in the income tax return for the year ending 30 June 2013. As a result you will only need to include the three quarterly distributions paid in the 2011/2012 income year in your income tax return for the year ended 30 June 2012.
 

Your income tax returns for the 2012 and 2013 income years will include Westpac SPS distributions for the following periods, which reflect the dates the distributions were or are expected to be paid.

Income year ended 30 June 2012

  • Distribution for the quarter ended 30 September 2011 - paid 30 September 2011

  • Distribution for the quarter ended 31 December 2011 - paid 3 January 2012

  • Distribution for the quarter ended 31 March 2012 - paid 2 April 2012

Income year ended 30 June 2013

  • Distribution for the quarter ended 30 June 2012 - paid 2 July 2012*

  • Distribution for the quarter ended 30 September 2012 - expected to be payable 2 October 2012

  • Distribution for the quarter ended 31 December 2012 - expected to be payable 31 December 2012

  • Distribution for the quarter ended 31 March 2013 - expected to be payable 2 April 2013

The Westpac SPS distribution for the quarter ended 30 June 2013, paid on 1 July 2013, fell into the 2014 income year.

* As 30 June 2012 was not a business day, the Westpac SPS distribution payment was made on the next business day, 2 July 2012, in accordance with the terms of the Westpac SPS.

Further enquiries

If you have any questions regarding the Westpac SPS, please call the Westpac SPS Information Line on 1300 139 843 Monday to Friday between 8.30am and 5.30pm (Sydney Time). 

ASX announcements relating to the issue of Westpac SPS

Media Release 31 July 2008 (PDF 34KB)
Media Release 28 July 2008 (PDF 42KB)
Media Release 26 June 2008 (PDF 40KB)
Media Release 18 June 2008 (PDF 49KB)