The information on this website is only available to persons who are not US Persons (as defined in Regulation S under the United States Securities Act of 1933, as amended (“US Securities Act”)), who are not acting for the account or benefit of a US Person and who are not prohibited by the laws of any jurisdiction outside Australia from accessing the Prospectus.
The Westpac Capital Notes 2 Offer is closed.
On 23 June 2014, Westpac Banking Corporation ("Westpac") issued 13,105,705 Westpac Capital Notes 2 ("Notes") at an Issue Price of A$100 each, raising approximately $1.31 billion of Additional Tier 1 Capital.
Westpac Capital Notes 2 trade on ASX under the ASX code "WBCPE".
About Westpac Capital Notes 2
Key features of the Notes:
- Westpac Capital Notes 2 are notes issued by Westpac.
- The Notes pay non-cumulative floating rate Distributions1, quarterly in arrear, beginning on 23 September 2014. Distributions are expected to be fully franked2.
- The Distribution Rate is determined quarterly as the sum of the 90 day Bank Bill Rate plus a fixed Margin, together multiplied by (1 - Tax Rate). The Margin is 3.05% per annum.
- The Notes are perpetual and have no fixed maturity date, but are scheduled to Convert into Ordinary Shares on 23 September 2024 (subject to the Scheduled Conversion Conditions).
- The Notes may, at Westpac’s option, be Converted, Redeemed (subject to APRA approval) or Transferred on 23 September 2022.
- The Notes must also be Converted into Ordinary Shares upon a Capital Trigger Event or a Non-Viability Trigger Event (broadly this is where Westpac suffers severe financial difficulty). The number of Ordinary Shares that Holders receive on a Conversion in these circumstances is subject to a maximum number and Holders are likely to suffer loss as a consequence. If for any reason Conversion is not possible in these circumstances, all rights attaching to the Notes will be terminated and the investment will lose all of its value, including to any unpaid Distributions.
- The Notes will automatically Convert earlier if an Acquisition Event occurs and Westpac may Convert, Redeem or Transfer the Notes if a Tax Event or Regulatory Event occurs, in each case subject to certain conditions.
- Holders have no right to request Conversion, Redemption or Transfer. To realise their investment, Holders may sell their Notes on ASX at the prevailing market price.
- In the event of a Winding Up of Westpac, if the Notes are still on issue (i.e. they have not been Redeemed or Converted), they will rank ahead of Ordinary Shares and equally with other existing Additional Tier 1 Capital securities of Westpac, but behind the claims of Senior Creditors (including depositors and all holders of Westpac’s senior or less subordinated debt). However, the ranking of the Notes in a winding up will be adversely affected by a Capital Trigger Event or Non-Viability Trigger Event.
- The Notes qualify as Additional Tier 1 Capital of the Westpac Group.
The Notes are not guaranteed or secured. The Notes are not deposit liabilities or protected accounts of Westpac for the purposes of the Banking Act 1959 (Cth) or Financial Claims Scheme and are not subject to the depositor protection provisions of Australian banking legislation (including the Australian Government guarantee of certain bank deposits). The Notes have not been, and will not be, registered under the US Securities Act or the securities law of any state of the United States and may not be offered, sold, delivered or transferred, directly or indirectly, in the United States or to, or for the account or benefit of, any US Person.
Further detail on the Notes can be found in the Prospectus.
1. Distributions are subject to satisfaction of the Distribution Payment Conditions.
2. Your ability to use the franking credits will depend on your individual tax position. The potential value of the franking credits does not accrue to you at the same time as you receive the cash Distribution.
|Issue Date of Notes||23 June 2014|
|Commencement of normal settlement trading||30 June 2014|
|Option for Westpac to Convert, Redeem or Transfer Notes1||23 September 2022|
|Scheduled Conversion Date2||23 September 2024|
1. There can be no certainty that APRA will provide its prior written approval for any such Redemption.
2. Conversion of the Notes into Ordinary Shares on this date is subject to satisfaction of the Scheduled Conversion Conditions.
Distributions on Westpac Capital Notes 2
The Notes pay fully franked floating rate Distributions quarterly in arrear (subject to the Distribution Payment Conditions) and are expected to be paid on 23 March, 23 June, 23 September and 23 December of each year, commencing on 23 September 2014. If any of these scheduled dates is not a Business Day, then the Distribution will be paid on the next Business Day without any interest in respect of the delay.
The Distribution Rate is calculated each quarter as the sum of the 90 day Bank Bill Rate plus the Margin, together multiplied by (1 – Tax Rate).
The formula can be summarised as: (90 day Bank Bill Rate + Margin) x (1 - Tax Rate).
The Distribution Rate will vary each quarter based on changes in the 90 day Bank Bill Rate. The Margin is 3.05% per annum and will not change.
The Bank Bill Rate is set on the first Business Day of each Distribution Period (which for the first Distribution Period is the Issue Date).
The first Distribution Period will run from (but excluding) the Issue Date to (and including) 23 September 2014. Thereafter, each Distribution Period runs from (but excluding) the previous Distribution Payment Date to (and including) the next Distribution Payment Date.
Holders are expected to receive cash Distributions and franking credits. Your ability to use franking credits will depend on your individual tax position. The potential value of the franking credits does not accrue to you at the same time as you receive the cash Distribution.
Distributions are within the absolute discretion of Westpac and only payable subject to the Distribution Payment Conditions. Distributions may not always be paid.
Distribution payments and record dates
|Distribution payment date||Relevant record date||Ex-distribution date|
|25 September 2017||15 September 2017
||14 September 2017
Distribution payment history
|Distribution payment date||Distribution rate per annum||Cash amount of Distribution per Westpac Capital Note 2||Number of days in the Distribution Period|
|25 September 2017||3.3390%1||$0.84161||92|
|23 June 2017||3.3915%||$0.8548||92|
|23 March 2017||3.3985%||$0.8380||90|
|23 December 2016||3.3530%||$0.8360||91|
|23 September 2016||3.5350%||$0.8910||92|
|23 June 2016||3.7415%||$0.9431||92|
|23 March 2016||3.7940%||$0.9459||91|
|23 December 2015||3.6668%||$0.9142||91|
|23 September 2015||3.6447%||$0.9187||92|
|23 June 2015||3.7135%||$0.9360||92|
|23 March 2015||4.0775%||$1.0054||90|
|23 December 2014||4.0168%||$1.0014||91|
|23 September 2014||4.0285%||$1.0154||92|
Footnotes to distributions:
1. Expected rate/amount per note
Prospectus and Notes Deed Poll
Westpac Capital Notes 2 Deed Poll (PDF 340KB) relating to Westpac Capital Notes 2. You may also refer to the Prospectus for information regarding the Notes Deed Poll.
Full details of the Westpac Capital Notes 2 are set out in the Prospectus. Nothing contained on this website or in the Prospectus constitutes financial product advice, investment advice or a recommendation to invest in the Notes. This website and the Prospectus have been prepared without taking into account your investment objectives, financial situation or particular needs. If you have any questions about the Notes, you should consult your professional adviser.
ATO Class Ruling
ASX announcements and investor presentation
If you have any questions regarding Westpac Capital Notes 2, please call the Westpac Capital Notes 2 Information Line on +61 1300 551 547 (local call costs within Australia), Monday to Friday, 8.30am - 5.30pm, Sydney time.
ASIC guidance for retail investors
ASIC has published guidance which may be relevant to your consideration of the Notes - namely, information for retail investors who are considering investing in hybrid securities called Hybrid securities and notes (under the heading “Complex investments” at www.moneysmart.gov.au/investing). The guidance includes a series of questions you may wish to consider and a short quiz, to check your understanding of how hybrids work, their features and the risks of investing in them.
A copy of the ASIC guidance can be printed off ASIC's website directly at the Hybrid securities and notes web page or a hard copy obtained by calling ASIC on 1300 300 630 from Australia or +61 3 5177 3988 (from outside Australia).
Westpac's Guide to Bank Hybrids
Westpac's Guide to Bank Hybrids, a web-based guide to help investors understand some of the typical features and risks associated with an investment in hybrid capital securities. The Guide to Bank Hybrids provides a brief overview of hybrid investments, including how to invest in an Australian bank and the typical features and risks of different types of bank hybrids. The Guide to Bank Hybrids may be helpful when you are considering an investment in a bank hybrid.