Westpac Capital Notes 5

Westpac Capital Notes 5 (Notes) are fully paid, non-cumulative, convertible, transferable, redeemable, subordinated, perpetual, unsecured notes issued by Westpac which trade on the ASX under the ASX code WBCPH.

Distributions on Westpac Capital Notes 5

Notes pay fully franked, non-cumulative floating rate Distributions quarterly in arrear (subject to the Distribution Payment Conditions). Distributions are expected to be paid on 22 March, 22 June, 22 September and 22 December of each year, until the Notes are Converted or Redeemed, commencing on 22 June 2018. 

The Distribution Rate is a floating rate and will generally be set on the first Business Day of each Distribution Period using the following formula:

Distribution Rate = (90 day Bank Bill Rate + Margin) x (1 – Tax Rate)

The Distribution Rate will vary each quarter based on changes in the 90 day Bank Bill Rate.

The Margin is 3.20% per annum and will not change.

Upcoming payment and record dates 

Distribution payment history

^{1 Expected rate/amount per Note.
2 Distribution Periods will generally have 90–92 days in them. The number of days in this Distribution Period is 101 days and is longer than the normal Distribution Period.}

 

Key features of Westpac Capital Notes 5

 

Term	Perpetual with no fixed maturity date. However, the Notes may be Converted, Redeemed or Transferred as outlined below.
Scheduled Conversion	Scheduled to Convert into Ordinary Shares on 22 September 2027 (subject to the satisfaction of the Scheduled Conversion Conditions). Please see Section 2.2 of the Prospectus for further information.
Optional Conversion/Redemption/Transfer	Westpac may elect to Convert into Ordinary Shares (subject to certain conditions), Redeem (if APRA gives its prior written approval), or Transfer all or some of the Notes on 22 September 2025; or  all (but not some only) of the Notes following a Tax Event or Regulatory Event. Please see Sections 2.3 and 2.4 of the Prospectus for further information.
Capital or Non-Viability Trigger Events	Westpac must Convert all or some of the Notes into Ordinary Shares immediately upon a Capital Trigger Event or a Non-Viability Trigger Event. The number of Ordinary Shares that Holders receive in these circumstances is limited by a Maximum Conversion Number (as required by APRA) and Holders may suffer loss as a consequence. If Conversion does not occur for any reason, all rights attaching to the Notes will be terminated and the investment will lose all of its value. Please see Section 2.5 of the Prospectus for further information.
Acquisition Event	Westpac must Convert all of the Notes into Ordinary Shares following an Acquisition Event, subject to certain conditions. Please see Section 2.6 of the Prospectus for further information.
Holders' right to request early Conversion/Redemption/Transfer	Holders have no right to request Conversion, Redemption or Transfer for any reason. To realise their investment, Holders may sell their Notes on the ASX at the prevailing market price. Westpac does not guarantee that Holders will be able to sell Notes on the ASX at an acceptable price or at all.
Risks	There are risks associated with an investment in the Notes, many of which are outside the control of Westpac. These risks and uncertainties include those referred to in the Prospectus, but may not be the only ones Westpac faces. Please see Section 5 of the Prospectus for further information.

^{1. Your ability to use the franking credits, either as an offset to your tax liability or by claiming a refund after the end of the year of income, will depend on your individual tax position. You should be aware that the potential value of the franking credits does not accrue to you at the same time as you receive the cash Distribution.}

 

In the event of a Winding Up, if the Notes are still on issue and have not been Redeemed or Converted, or otherwise had the rights attaching to them terminated, they will have priority over Ordinary Shares and rank equally with certain other Capital Securities issued by Westpac, but they will be subordinated to claims of Senior Creditors. However, it is likely that a Capital Trigger Event or Non-Viability Trigger Event would occur prior to a Winding Up and the Notes would have been Converted into Ordinary Shares or otherwise had the rights attaching to them terminated.

There can be no certainty that Westpac will choose to Redeem the Westpac Capital Notes 5 early, or that APRA will provide its approval to any proposed Redemption.

WARNING - Westpac Capital Notes 5 are not deposit liabilities of Westpac, are riskier than bank deposits and may not be suitable for some investors. Their overall complexity may make them difficult to understand and the risks associated with the Notes could result in the loss of all of your investment. If you do not fully understand how they work or the risks associated with them, you should obtain professional advice.

The Notes are not deposit liabilities or protected accounts of Westpac for the purposes of the Banking Act 1959 (Cth) or the Financial Claims Scheme and are not subject to the depositor protection provisions of Australian banking legislation (including the Australian Government guarantee of certain bank deposits). Therefore, the Notes are not guaranteed or insured by the Australian Government, any government agency or compensation scheme of Australia or any jurisdiction.

The Notes have not been, and will not be, registered under the U.S. Securities Act of 1933 (U.S. Securities Act) or the securities laws of any state or other jurisdiction of the United States and may not be offered, sold, delivered or transferred in the United States or to, or for the account or benefit of, any U.S. person (as defined in Regulation S under the U.S. Securities Act). None of the Prospectus, or any Application Form or any other materials relating to the Offer may be distributed in the United States.

Key dates for Westpac Capital Notes 5

^{1 Subject to satisfaction of the Optional Conversion Restriction.
2 There can be no certainty that APRA will provide its prior written approval for any such Redemption.
3 Conversion of the Notes to Ordinary Shares on this date is subject to the satisfaction of the Scheduled Conversion Conditions.}
 

 

Prospectus and Notes Deed Poll

Prospectus (PDF 1MB) relating to Westpac Capital Notes 5, 13 February 2018

Notes Deed Poll (PDF 5MB) relating to Westpac Capital Notes 5.

The Notes Deed Poll was executed by Westpac on 9 February 2018 and is available for download via the link above. Refer to the Prospectus for information regarding the Notes Deed Poll.

ATO Class Ruling

On 14 March 2018, the Australian Taxation Office issued a Class Ruling, which confirms the Australian tax consequences for certain holders of Westpac Capital Notes 5.

You can view a copy of the Class Ruling here. ATO Class Ruling (PDF 543KB)

 

Announcements and other documents

1. ATO Class Ruling, 14 March 2018 (PDF 543KB)
2. ASX Westpac Capital Notes 5 Issue Announcement, 13 March 2018 (PDF 396KB)
3. ASX Westpac Capital Notes 5 Prospectus, 13 February 2018 (PDF 1MB)
4. ASX Westpac Capital Notes 5 Bookbuild and Margin Announcement, 9 February 2018 (PDF 369KB)
5. ASX Westpac Capital Notes 5 Offer Announcement, 5 February 2018 (PDF 537KB)
6. ASX Westpac Capital Notes 5 Investor Presentation, 5 February 2018 (PDF 1MB)
7. ASX Westpac Capital Notes 5 Offer Letter to Eligible Westpac CPS Holders, 5 February 2018 (PDF 238KB)

 

Guidance for retail investors

ASIC Guidance
Further guidance on investing in bank hybrid securities can be found on ASIC’s MoneySmart website.

A free copy of the ASIC guidance may be obtained by calling ASIC on 1300 300 630 (from within Australia) or +61 3 5177 3988 (from outside Australia).

Westpac's Guide to Bank Hybrids
Westpac’s Guide to Bank Hybrids is a web-based guide that may help investors understand some of the typical features and risks associated with an investment in bank hybrid securities.

The Guide to Bank Hybrids may be helpful when you are considering an investment in the Notes.

Professional Advice
The information in the Prospectus is not investment advice and has been prepared without taking into account your investment objectives, financial situation and particular needs (including financial and taxation considerations) as an investor.

You can speak to your stockbroker, solicitor, accountant or other independent and qualified professional adviser to find out more about the Notes. You can also find a financial adviser that suits you on the following websites:

• https://www.moneysmart.gov.au/investing/financial-advice/choosing-a-financial-adviser; or
• https://faaa.au/find-a-planner/

Please be aware consultation with a financial adviser will likely incur fees.