(The following was released by the rating agency)
SYDNEY (Standard & Poor's) Sept. 3, 2012--Standard & Poor's Ratings Services said today that it has assigned its 'BBB-' issue credit rating to the proposed perpetual exchangeable resaleable listed securities (PERLS VI) to be issued by Commonwealth Bank of Australia (CBA, AA-/Stable/A-1+).
CBA intends to use the PERLS VI offer to raise approximately A$750 million for the purposes of capital management.
PERLS VI are rated four notches below CBA's stand-alone credit profile. The issue rating reflects:
-- The securities' risk of subordination;
-- The risk of partial or untimely payment;
-- The distributable profits payment test; and
-- A contingency clause requiring mandatory conversion into common equity on the activation of a non-viability trigger.
Standard & Poor's has assessed the proposed PERLS VI issue as having 'intermediate' equity content, under our rating criteria. Further, in our opinion, PERLS VI is likely to meet The Australian Prudential Regulatory Authority's (APRA) requirements for inclusion as Basel III Additional Tier I capital.