WestpacTrust Retail Bond An Innovative Alternative
WestpacTrust will introduce a first for New Zealand investors today (Monday 19 November), with its issue of WestpacTrust Retail Bonds.
The bonds will be made available through WestpacTrust’s retail branch network at the same time as to institutional investors, the first time such an issue has been offered simultaneously to wholesale and retail markets.
Customers can invest a minimum of $10,000, and more in multiples of $1,000, for three years at a fixed interest rate of 5.50% p.a. Interest is paid every six months.
“In the current climate for investors, WestpacTrust Retail Bonds provide an easily accessible, flexible alternative for investors that is well placed on the risk/return spectrum,” says Westpac Institutional Bank Head of Interest Rate Sales Mark Butcher.
“This is a prime opportunity for retail investors to enhance their investment portfolio,” he says. “While the interest rate is favourable compared with a term investment, customers can exit or add to their investment at any time during the three years on the terms of the issue. At the same time, the bonds, which are unsecured senior ranking debt, offer better security compared with other options such as capital notes.”
WestpacTrust expects high demand for the Bonds, which have an AA- rating from Standard & Poors, from traditional term investment buyers who desire more flexibility.
“The Retail Bond suits investors who want to be confident about their income for the term of the Bonds while still having liquidity. These Bonds provide fixed, regular income, with an attractive interest rate, without locking investors in.
“We’re confident this offer will help satisfy investors’ demand for greater choice in the retail investment market. We also expect a strong secondary market to develop, with customers able to buy and sell bonds after the initial offer period.”
He said this first WestpacTrust Retail Bond issue would lead the way for further issues of varying maturities.
“As we measure the success of this first retail issue we will look to bring further issues to the market by both WestpacTrust and other borrowers,” he said.
The bonds are issued by WestpacTrust in conjunction with its wholesale arm, Westpac Institutional Bank (WIB), and will be available for a limited period from Monday 19 November to Friday 30 November.
Customers can get an investment statement and WestpacTrust Retail Bond application form through any of WestpacTrust’s 200 branches, online at www.westpactrust.co.nz or through the Bank’s Phone Assist call centre on 0800 400 600.