The big four bank stated “given the strong support shown by eligible shareholders”, it would be increasing the size of its share purchase plan (SPP) offer to $1.25 billion from its initial $500 million.
Under the plan, around 88 million new fully paid NAB ordinary shares will be issued to successful applicants on 2 June at an issue price of $14.15 per share, representing approximately 2.8 per cent of NAB’s ordinary shares on issue.
Chief executive Ross McEwan commented the capital will be used to protect the bank against COVID-19, including the possibility of a “prolonged and severe economic downturn”.
“We received strong interest in the offer, allowing us to increase its size by an additional $750 million and we thank our shareholders for their ongoing support of the bank and its future,” Mr McEwan said.
NAB had initially asked investors for $3.5 billion in capital to strengthen its buffer against COVID-19-related losses when it released its first-half results in April.
It completed its $3 billion institutional raise the day after the results were published.
The bank’s earnings had fallen by 51 per cent year-on-year, with it responding by cutting the fixed remuneration of executives by 20 per cent and docking its dividend by almost two-thirds.
Earlier this month, the bank reported it had provided 120,000 loan deferrals and granted more than $370 million in loans to small businesses as part of the government’s SME Loan Guarantee Scheme in response to COVID-19.
Sarah Simpkins
Sarah Simpkins is a journalist at Momentum Media, reporting primarily on banking, financial services and wealth.
Prior to joining the team in 2018, Sarah worked in trade media and produced stories for a current affairs program on community radio.
You can contact her on [email protected].
