Rabobank raises $900 million

Rabobank of the Netherlands, which has the highest available credit ratings from both Standard & Poor's and Moody's, has raised $900 million in its first securities offer to the Kiwi public.

Rabobank had sought a minimum of $400 million in its perpetual capitalsecurities offer, a form of debt.

However, the offer was open to unlimited oversubscriptions.

Strong demand from 'mum and dad' retail investors seeking a refuge from the tottering finance company sector, saw the offer surge to $900 million when a book build closed on Friday.

Retail investors took about 75 per cent of the bonds with institutional, or professional, investorstaking the rest.

The securities are expected to pay an initial interest rate of about 9.29 per cent.

It will be set 76 basis points above the one year swap rate on October 8.

Rabobank, largely through its banking services to the rural community, has more than $5 billion in New Zealand dollar denominated assets but previously did not have any equity on its balance sheet here.

Bert Bruggink, chieffinancial officer of the Utrecht-based Rabobank, said in Auckland this week this was why Rabobank decided to issue the securities.

Mr Bruggink said because Rabobank had the top triple A credit ratings frominternational credit agencies, it was strongly positioned as a credit squeeze sweeps global financial markets.

Rabobank has applied to the stock exchange for the securities to be tradable on the NZX debt market.

The offer was managed by First NZ Capital and ASB Securities.

- © Fairfax NZ News