AMP Notes will be offered in Australian and New Zealand dollars and will be listed on the stock exchanges in both countries.
They are unsecured and subordinated notes and will pay interest quarterly. The rate will be known after the book build process is completed.
AMP Notes are 10-year securities with a five year call option. They provide AMP with the option to redeem the notes in May 2014 or on any following interest payment date, subject to regulatory approval. If AMP does not redeem the notes after May 2014, the margin above the relevant market-based rate will increase.
The rate is based on a margin over the swap rate.
The AMP Notes have been provisionally rated A- by Standard & Poor’s and A3 by Moody’s.
AMP has set the minimum investment at $5,000.
“We have been evaluating options to raise Tier 2 capital to optimise the efficiency of our capital mix, meet general funding requirements and support the refinancing of subordinated debt,” AMP chief executive Craig Dunn said.
The notes reflect “a prudent approach to capital preservation and a bias towards holding more capital than less to give added strength to our balance sheet through challenging markets.”
AMP is looking to raise up to A$300 million through the offer with the option to accept more or less, depending on investor interest.
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