Biggest ever non-Govt bond offer reaches the end

Rabobank has decided to redeem its bonds (NZX:RBOHA) which had a resettable rate, and where wildly popular when they were issued 10 years ago.

The bank sold $900 million worth of bonds just as the finance company sector was collapsing during the GFC. It was, and remains, New Zealand’s largest ever non-government debt issue.

The bonds were a perpetual security with resettable interest rates. The original rate was 9.482%, set at a margin of 76 basis points over the one-year swap rate. But as the swap rate fell the interest rate reduced to just over 2% at one stage.

Rabobank will exercise its right to fully redeem the bonds with the final day of trading being September 27.