National's Hybrid Tier 1 Capital Security Issue - 23 September 2003

National Australia Bank today announced an issue of GBP400 million Tier 1 Trust Preferred Securities.  The securities carry a coupon of 5.62% which represents a margin of 0.93% over the benchmark UK government security.  The perpetual securities are callable on 17 December 2018 subject to the approval of APRA. Based on this attractive pricing, the deal was increased by 33% from its original GBP300m target.

An issue of Tier 1 capital is consistent with the National's strategy of maintaining an efficient capital structure through active capital management. The proceeds from the Tier 1 issue will be used by the National's London Branch for operational banking purposes.