Australia and New Zealand Banking Group Limited (“ANZ”)
A$ Debt Instrument Programme dated 8 April 2014
Dated 1 June 2015
Nature of the TCDs
Transferable Certificates of Deposit (“TCDs”) constitute senior, direct, unconditional, unsecured and unsubordinated obligations of ANZ and will rank at least equally with with all other unsecured and unsubordinated obligations of ANZ except liabilities mandatorily preferred by law. The TCDs do not constitute protected accounts in Australia for the purposes of the Banking Act.
.25% per annum, payable semi-annually (in two coupons of 1.625%) in arrears on 3 June and 3 December in each year, including the Maturity Date.
Repayment at Par on the Maturity Date
On the Maturity Date, holders are scheduled to receive the Face Value and the final Coupon Payment for the last Coupon Period.
The value of an investment in the TCDs may fluctuate due to various factors, including investor perceptions, worldwide economic conditions, interest rates, debt market conditions and factors that may affect ANZ’s financial performance. The following risks may also affect an investment in the TCDs:
- Lack of liquidity – in the secondary market for TCDs;
- Interest rate risks – holders may suffer unforeseen losses due to fluctuations in interest rates;
- Regulatory risks – The banking industry in Australia is highly regulated, and regulatory changes may adversely affect ANZ’s financial performance;
- Banking Act – The TCDs constitute direct, unsubordinated and unsecured deposit liabilities of ANZ , ranking pari passu with all other senior, direct, unconditional, unsecured and unsubordinated obligations of ANZ, however, they are not protected accounts within the meaning of the Banking Act 1959, as such there will likely be significant liabilities of ANZ that are likely to be mandatorily preferred liabilities;
- Litigation risks – Risks relating to litigation and regulatory actions;
- Operational risks – The risk of loss resulting from inadequate internal processes and controls, people and systems or from external events;
- Default risk – if an event of default occurs under the TCDs, or ANZ fails to perform any obligation in relation to the TCDs, such event or failure may impact on the value of an investment in the TCDs, the transferability of the TCDs and the ability of a holder to recover amounts due under the TCDs.
Key benefits include:
- interest paid semi-annually in arrears;
- interest paid is fixed rate;
- interest paid as 100% cash;
- interest is not deferrable nor are interest payments discretionary;
- rank equally with all other senior and unsecured creditors of the Issuer.
Early Redemption by Issuer
Yes, for tax reasons
Events of Default
Events of Default include:
- Payment Default: Applicable, with a 7 day cure period for principal and interest payments;
- Breach of other obligations: Applicable, with a 30 day cure period;
- Insolvency / Winding Up: Applicable;
- Enforcement against assets: Applicable, with a cure period of 45 days.
Climate (Green) Bonds
Certified as Climate Bonds under the Climate Bonds International Standards and Certification Scheme by the Climate Bonds Initiative. Recertified annually with next verification due on 31 May 2017.
If the TCDs cease to comply with the Climate Bond Standard, and ANZ receives notice from the Climate Bonds Initiative, ANZ will notify holders thereof. This is not an event of default.
ANZ stated at the time it issued the TCD’s that it will use the proceeds to refinance a pool of ANZ’s loans in renewable energy (wind, solar) and green buildings.
Coupon Schedule to Maturity
- 3 June 2017
- 3 December 2017
- 3 June 2018
- 3 December 2018
- 3 June 2019
- 3 December 2019
- 3 June 2020 - Maturity Date