(10 November 2008 – Australia) National Australia Bank (NAB) has announced that it has launched an A$2 billion institutional placement in order to strengthen its balance sheet.NAB said that it has launched an institutional placement of shares to raise approximately A$2.0 billion to strengthen its balance sheet and take advantage of organic growth opportunities.
The placement has been fully underwritten by Goldman Sachs JBWere, Merrill Lynch and UBS AG, Australia Branch.
NAB said that the initiative was consistent with NAB’s previously announced intention to raise capital equivalent to its next two Dividend Reinvestment Plan (DRP) shortfalls.
The bank also said that more favourable market conditions have enabled NAB to accelerate its capital management plans and accordingly, upon successful completion of the placement, NAB will no longer proceed with its underwrite of the DRP for the 2008 final dividend.
Following the placement, NAB will also offer retail shareholders the opportunity to participate in a non-underwritten share purchase plan (SPP) at the institutional placement price.
The capital raising will result in NAB moving immediately to a Tier 1 ratio of approximately 8.0 percent.
Due to the announcement NAB requested that its shares on the ASX be halted from trading.