ANZ raises capital for growth and stability
(27 May 2009 – Australia) ANZ has had trading on its shares halted and announced a A$2.5 billion share placement with a view to buying RBS assets in Asia and to strengthen the bank’s capital position.
ANZ will undertake a fully underwritten institutional share placement to raise $2.5 billion of capital.
In an announcement, ANZ said that the placement was to create greater financial flexibility to pursue strategic and organic growth opportunities and to further strengthen the bank’s capital position.
In practice, this means that the capital raising will ANZ to fund the acquisition of RBS assets, if its proposal is successful, while also creating extra capital to cover increasing provisions.
ANZ said that it has recently submitted a non-binding proposal to RBS Group for selected businesses in Asia. The share placement would allow ANZ to fund the acquisition while maintaining its capital ratio.
The bank said that this share placement would allow it to fund an acquisition of selected RBS Asia assets. If such an acquisition were to proceed, ANZ’s Tier 1 capital ratio immediately afterwards would be above its target range of 7.5 to 8.0 percent, the bank indicated.
ANZ said that it expects that the credit provision charge in the second half of financial year 2009 will be around 20 percent higher than that of the first half of A$1.435 billion.
The placement has been set at an offer price of $14.40, a 7.5 percent discount to its last traded price of $15.57.
ANZ will also offer retail shareholders a chance to participate, in a separate non-underwritten share purchase plan that allows $15,000 per investor without brokerage up to a total value of $350 million.
In an announcement, ANZ said that the placement was to create greater financial flexibility to pursue strategic and organic growth opportunities and to further strengthen the bank’s capital position.
In practice, this means that the capital raising will ANZ to fund the acquisition of RBS assets, if its proposal is successful, while also creating extra capital to cover increasing provisions.
ANZ said that it has recently submitted a non-binding proposal to RBS Group for selected businesses in Asia. The share placement would allow ANZ to fund the acquisition while maintaining its capital ratio.
The bank said that this share placement would allow it to fund an acquisition of selected RBS Asia assets. If such an acquisition were to proceed, ANZ’s Tier 1 capital ratio immediately afterwards would be above its target range of 7.5 to 8.0 percent, the bank indicated.
ANZ said that it expects that the credit provision charge in the second half of financial year 2009 will be around 20 percent higher than that of the first half of A$1.435 billion.
The placement has been set at an offer price of $14.40, a 7.5 percent discount to its last traded price of $15.57.
ANZ will also offer retail shareholders a chance to participate, in a separate non-underwritten share purchase plan that allows $15,000 per investor without brokerage up to a total value of $350 million.
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