29 September 2009
Launch of New 2025 Treasury Indexed Bond
The Australian Office of Financial Management (AOFM) announces the issue by syndication of a new 3.0% 20 September 2025 Treasury Indexed Bond. The initial issue size is expected to be at least $1 billion.
Pricing of the issue is expected to take place no later than 1 October 2009.
- Initial price guidance for the issue is a yield spread of 0 to 5 basis points to the 20 August 2020 Treasury Indexed Bond, subject to market conditions.
Holders of the 2010 Treasury Indexed Bond will be offered the opportunity to convert each $100 face value of that bond (unadjusted for changes in the inflation-adjusted capital value of the bond) to $160 face value of the new 2025 Treasury Indexed Bond.
- The indicative repurchase price for the 20 August 2010 Treasury Indexed Bond will be calculated by reference to the yield that is 210 basis points below the yield for 15 August 2010 nominal Treasury Bond at the time the new 2025 Treasury Indexed Bond is priced.
The AOFM has appointed Deutsche Bank AG Sydney Branch, RBS Group (Australia) Pty Limited and UBS AG Australia Branch as Joint-Lead Managers for the issue. Citigroup Global Markets Australia Pty Limited, JP Morgan Australia Limited and Westpac Banking Corporation Limited have been appointed Co-Managers.
New Information Memoranda for Treasury Indexed Bonds and Treasury Bonds are being issued today.
- The new Information Memorandum for Treasury Indexed Bonds replaces the Terms and Conditions of Issue for Treasury Indexed Bonds dated 18 February 2002. The new 2025 Treasury Indexed Bond will be subject to the new Information Memorandum for Treasury Indexed Bonds.
- The Information Memorandum for Treasury Bonds has been updated to clarify the pricing of near-to-maturity Treasury Bonds and expected changes in relation to the application of non-resident interest withholding tax.