Ann: ANZ CPS2 Margin Announcement , page-9

In terms of liquidity I think that it will be high as they received applications for approximately $2.70 billion and issued $1.70b.

I would also imagine that they will issue $300m to retail investors which will most likely be oversubscribed.

This is likely to see ANZPA trade above face, probably similar to CBAPA (about 3.0% above).

The next question is whether or not WBC and NAB issue more hybrids and at what margin?

I think that both will and margin will be 2.80% - 3.10%.

Whilst posts on HC have objected to ANZ raising so much capital I think that it may be a cleaver strategy going forward if world markets have another financial shock and access to credit falls.

Whilst 3.10% is high on a relative basis it is pretty low on a risk adjusted basis as the term is 7 years.

Also ANZ does not have to pay dividends if it enters financial difficultly and ANZPA holders cant force ANZ into liquidation like other debt holders

Therefore the extra 1.50% above current 3 year debt rates is pretty low given ANZ's flexibility in payments.

If they are about to make large acquisitions I would prefer them to do it using these types of funds.

Good luck to all