ANZ Bank gets $1.75b tier 2 debt; rush for fixed-rate slice

Australia and New Zealand Banking Group ended up taking in $1.75 billion from its tier 2 debt deal on Wednesday evening, with the allocations showing investors’ preference for fixed rate pricing, once again.Of the $1.75 billion raised, only $300 million was in the floating rate tranche, while the bigger $1.45 billion part was in fixed to floating rate.The deal’s interesting for two reasons.

It was announced right after the Reserve Bank of Australia lifted the cash rate by 50bps, and it’s a repeat of investors’ preference for fixed rate allocations that played out in a similar deal from National Australia Bank last week. NAB’s tier 2 subordinated transaction ended up being 80 per cent in the fixed format, which fixed income investor reckon could be a record and a change brought about by uncertainty around rates.

co-edits Street Talk, specialising in private equity, investment banking, M&A and equity capital markets. He has 10 years' experience as a business journalist and worked at PwC, auditing and advising financial services companies.

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