Westpac in $2.5 billion capital raising
Westpac is the latest of the big four banks to announce it will take part in a capital raising, with the bank to embark on a fully underwritten institutional share placement to raise $2.5 billion.
The decision to undertake the capital raising was in part influenced by the impact of the slowing economy and possible further deterioration in credit and operating conditions, the bank’s statement to the Australian Securities Exchange said. It would also enable Westpac to take advantage of potential growth opportunities.
The bank said that demand on its balance sheet is expected to increase in coming months, as a result of corporate bonds reaching maturity and a reduction in foreign bank capacity for Australasian corporates. Furthermore, the bank said that with hybrid equity markets becoming increasingly challenging, its “ability to raise capital through this mechanism, including the replacement of St George Bank hybrids, is uncertain”.
The placement will be conducted by way of an institutional book build, and the bank’s shares have been placed in a trading halt, which is expected to be lifted tomorrow morning.
Westpac will also offer retail shareholders the opportunity to participate in a non-underwritten share purchase plan, with subscriptions of up to $10,000 of Westpac ordinary shares available. Applications will be scaled back if total demand exceeds $500 million.
Recommended for you
Licensee Centrepoint Alliance has completed the acquisition of Brighter Super’s annual review service advice book, via Financial Advice Matters.
ASIC has launched court proceedings against the responsible entity of three managed investment schemes with around 600 retail investors.
There is a gap in the market for Australian advisers to help individuals with succession planning as the country has been noted by Capital Group for being overly “hands off” around inheritances.
ASIC has cancelled the AFSL of an advice firm associated with Shield and First Guardian collapses, and permanently banned its responsible manager.
