This offer closed on:
19 August 2021

Capital Notes 3

Morgans is a Joint Lead Manager to the Offer⁽¹⁾

Macquarie Bank Limited (MBL) has announced it is seeking to raise $400 million⁽²⁾ through the issue of Macquarie Bank Capital Notes 3 (Notes) at an issue price of $100 each. Macquarie Bank Capital Notes 3 are fully paid, unsecured, subordinated, non-cumulative, mandatorily convertible notes.

Macquarie Bank Capital Notes 3 may be suitable for investors looking for regular partially franked⁽³⁾ income by way of floating rate distributions. Macquarie Bank Capital Notes 3 may offer investors the opportunity to further diversify their income portfolio.

Macquarie Bank Capital Notes 3 are a complex investment and may be difficult to understand, even for experienced investors, and involve different risks from a simple debt or ordinary equity security. You should ensure that you understand the Macquarie Bank Capital Notes 3 Terms and risks of investing in Macquarie Bank Capital Notes 3 and consider whether it is an appropriate investment for your particular circumstances. It is important that you read the Replacement Prospectus in full before deciding to invest in Macquarie Bank Capital Notes 3.

Key features of the Offer

• Opportunity to participate in the Broker Firm Offer via Morgans as a Joint Lead Manager to the Offer
• Macquarie Bank Capital Notes 3 have a face value of $100 and are redeemable by the issuer on 7 September 2028, 7 March 2029 and 7 September 2029⁽⁴⁾
• If not redeemed before, Macquarie Bank Capital Notes 3 will convert into MGL Ordinary Shares on 8 September 2031⁽⁵⁾ 
• Quarterly (partially franked) gross distributions⁽⁶⁾ equal to the 3 Month Bank Bill Rate plus a margin of 2.90 - 3.10%⁽⁷⁾ i.e. approximately 2.92 - 3.12% p.a⁽⁸⁾
• Distributions are discretionary, non-cumulative and subject to the Distribution Payment Conditions outlined in the Replacement Prospectus but must be paid ahead of MBL Ordinary Share dividends, and if not paid, dividend and capital restrictions apply to MBL Ordinary Shares
• At the issue date, Macquarie Bank Capital Notes 3 will constitute as APRA eligible regulatory capital instruments and contain Automatic Exchange Events (Common Equity Tier 1 Trigger Event and a Non-Viability Event) which may impact their value in certain circumstances⁽⁹⁾
• Are expected to be quoted on the ASX under the code MBLPD⁽¹⁰⁾

Issuer: Macquarie Bank Limited (MBL)

Transaction: Capital Notes Offer

Morgans Role: Joint Lead Manager

Offer Size: $400 million

Offer Opening Date: 11 August 2021

Morgans Broker Firm applications closing date: 23 August 2021

Investments in the Notes are an investment in MBL and will be affected by the ongoing performance, financial position and solvency of MBL. Notes are not deposit liabilities and are not protected accounts of MBL under the Banking Act 1959 (Cth) and are not guaranteed or insured by any government, government agency or compensation scheme of Australia or any other jurisdiction. Other than MBL, no other member of the Macquarie Group is an authorised deposit-taking institution (“ADI”) for the purposes of the Banking Act. The investment performance of Notes is not guaranteed by MBL, Macquarie Group Limited (“MGL”) or any other member of the Macquarie Group.

There are a number of risks associated with an investment in Notes, many of which are outside the control of MBL.  Before applying for Notes all investors should consider whether Notes are a suitable investment for them including by considering the key risks as outlined in sections 1.3 and 4 of the Replacement Prospectus.

No cooling-off rights (whether by law or otherwise) apply to an Application for Notes. This means, that in most circumstances, you cannot withdraw your Application once it has been lodged, except as permitted under the Corporations Act.

Footnotes

1. Morgans will receive fees for its role.
2. MBL may issue more or less than $400 million of Notes.
3. The level of franking may vary over time and Distributions may be partially, fully or not franked. The availability of franking credits is not guaranteed. If Distributions are franked, the value and availability of franking credits to a Noteholder will depend on that Noteholder’s particular circumstances and the tax rules that apply at the time of each distribution. 
4. Subject to APRA approval. Notes are perpetual and do not have a fixed maturity date. If Notes are not Exchanged, Redeemed or Written-Off, they could remain on issue indefinitely and the Issue Price may not be repaid.
5. Conversion is subject to Conversion Conditions as outlined in the Replacement Prospectus.
6. Distributions are non-cumulative, paid at the discretion of MBL and subject to Distribution Payment Conditions.
7. Margin will be determined under a Bookbuild, may set outside this range and will not change after that determination is made. The Bookbuild occurs before the Offer Opens.
8. Based on 3 Month Bank Bill Rate of 0.02%.
9. An Automatic Exchange Event (including where MBL experiences financial difficulty) may result in Exchange or Write-off of Notes; full detail is contained in the Replacement Prospectus and Morgans Offer Summary.
10. Application will be made to list Notes on ASX.

More information

Investors should read the Replacement Prospectus in full to understand the features and risks of Macquarie Bank Capital Notes 3. Please contact your Morgans adviser to apply under the Offer.

If you have any questions about the Offer, please contact your Morgans adviser, call 134 226 or find your nearest office.

Download Prospectus

Macquarie Bank Capital Notes 3 are being offered only in Australia and the Replacement Prospectus will only constitute an offer to a person receiving it in Australia. Not for distribution, directly or indirectly, in the United States or to, or for the account or benefit of, US Persons, except in accordance with an available exemption from the registration requirements of the US Securities Act. The distribution of the Replacement Prospectus (including an electronic copy) in jurisdictions outside Australia may be restricted by law.

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