NAB, Deutsche Bank and Westpac are the joint lead managers for the BoQ Wholesale Capital Notes issue.
An analysis by investment researcher BondAdviser said the BoQ notes are structured as perpetual, subordinated, unsecured notes and distributions are preferred, discretionary, floating rate, franked, non-cumulative and subject to payment conditions.
"These securities are issued directly by the bank and will qualify as additional tier one regulated capital (Basel III eligible)," BondAdviser said.
The interest margin will be set at the bookbuild, but guidance has been given at approximately 4.35 per cent above the 180-day bank bill swap rate.
"Interest distributions will be paid in arrears on a semi-annual basis until conversion, redemption or resale," BondAdviser said.
"Subject to conversion conditions being satisfied, the notes are scheduled for mandatory conversion into BoQ ordinary shares in (May 2022), or later when the conditions are satisfied," the researcher said.
"BoQ also has the right (but not the obligation) to convert, redeem or resell (subject to APRA approval) the notes on the optional exchange date (May 2020)," BondAdviser said.
"These options are also possible following a tax or regulatory event. In the event of a change of control the note must convert subject to meeting the required conversion conditions."
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