UPDATE 1-Bank of America prices A$1.2 bln senior and sub FRN
(Adds deal details, comment)
SYDNEY, Feb 7 (Reuters) - Bank of America Corp. (BAC.N) has priced a total of A$1.2 billion ($930 million) in senior and subordinated Kangaroo floating rate notes (FRN), the joint leads said on Wednesday.
Banc of America Securities (BAS), Commonwealth Bank of Australia (CBA) and Westpac Institutional Bank (WIB) were joint leads. ANZ Investment Bank was a co-manager on the issue.
This is the first time a financial institution has raised a straight 10-year subordinated debt lower Tier II issue in Australia.
Until now, they have usually opted for a structure that includes a call date, typically five years, after which the margin steps up should the bonds not be called.
Because of Australia's inverted yield curve, issuers tend to prefer longer maturities paying a lower interest than shorter-dated paper.
Bank of America Corporation is the holding company for Bank of America N.A. and other subsidiary companies and is rated AA- by S&P, Aa2 by Moody's and AA- by Fitch.
Pricing details are:
1) 5-yr senior tranche
Issuer: Bank of America Corp.
Facility: Domestic Kangaroo senior FRN
Amount: A$1 billion
Maturity: Feb. 14, 2012
Set date: Feb. 14
Coupon: 18 bps over 90-day BBSW
Spread: 18 bps over 90-day BBSW
Issue price: 100
Lead(s): BAS, CBA and WIB
Co-manager(s): ANZ
Issue rating: AA- by S&P, Aa2 by Moody's and AA- by Fitch
2) 10-yr sub tranche
Issuer: Bank of America Corp.
Facility: Domestic Kangaroo subordinated lower Tier II FRN
Amount: A$200 million
Maturity: Feb. 14, 2017
Set date: Feb. 14
Coupon: 38 bps over 90-day BBSW
Spread: 38 bps over 90-day BBSW
Issue price: 100
Lead(s): BAS, CBA and WIB
Co-manager(s): ANZ
Issue rating: A+ by S&P, Aa3 by Moody's and A+ by Fitch ($1=A$1.29)
