Quote Originally Posted by Aaron View Post
Thanks Peat and GMT. I guess the minimum indicative range was further in the prospectus. 5.4% tied up for 15 years(or possibly 5 years). Not for me.

Another question for the bond market gurus.

Rabobank Perpetual Bonds (RCSHA) Rabo bank must have issued these at 8.43% why don't they issue new bonds at a much lower rate and redeem the perpetual bonds. I haven't made any effort to investigate this so don't put in too much effort on my behalf. It just seems odd that they are paying such a high rate. Maybe it is to do with their creditworthiness.

It is just that I use rabodirect and have a number of term deposits constantly roling over waiting for the big crash (GFC2) it would be a damn shame if Rabodirect were the first to close their doors in a crash before I could invest my savings.
No, it was announced by NZX on the 17th
https://www.nzx.com/announcements/318109

Personally I think many would consider 5.4% p.a. a pretty good rate of return at the moment even for a 5 years maturity.
However one must take into account the risk of being a subordinated debtor of NZX Ltd, a company that has a monopoly but struggles to grow the business.
Still, as a note holder one isn't so much concerned with growth merely stability and it would actually be hard to see them stuffing it up so badly that the business fails.
Probably a reasonable risk for a small percentage of a fixed interest portfolio.

I use RaboDirect for some reasonably large amounts and have faith in their credit worthiness.
RCSHA has a much lower credit rating than the bank itself.
See https://www.nzx.com/announcements/316217