Australia's ANZ sells A$1.25 bln five-year notes

SYDNEY, Nov 5 (Reuters) - Australia and New Zealand Banking
Group Ltd (ANZ.AX) (ANZ), the smallest of Australia's four big
lenders, has sold A$1.25 billion ($1.1 billion) of five-year
transferable deposits at 100 basis points over the bank bill
swap rate, it said on Thursday.

The issue, which consisted of A$625 million in fixed rate
notes and A$625 million in floating rate notes, was the bank's
second bond offer without an Australian government guarantee.
The guarantess was put in place late last year to help banks
weather the global financial crisis.

Around 78 percent of the offer was sold to fund managers,
insurance companies, private banks, middle market investors and
government buyers, with only 22 percent placed with banks, ANZ
said.

"Conditions for debt issuance in the domestic market have
become more difficult due to the uncertainty caused by APRA
[The Australian Prudential Regulation Authority (APRA)]'s
liquidity discussion paper," said Rick Moscati, ANZ group
treasurer.

APRA, the local regulator which oversees the financial
services industry, is considering tightening liquidity rules by
revising the definition of liquid securities.

As a result, banks, that are usually active buyers of
bonds, have been sitting on the sidelines since October,
waiting for a clarification from APRA. See [ID:nSP401213] for
more details.

"There was limited interest from bank treasuries," ANZ's
Moscati said, commenting on the bank's new issue.

Around 15 percent of the ANZ's bonds were sold offshore,
mostly in Asia, ANZ said.

(Reporting by Cecile Lefort)