National Australia Bank Limited · ASX:NAB
National Australia Bank — Debt Investor Presentation (February 2020)
24 slides from National Australia Bank's debt investor presentation, Feb 17, 2020
Slide 1: NAB Capital Notes 4 Investor Presentation
For personal use only NAB CAPITAL NOTES 4 Investor Presentation February 2020
Slide 2: Important Notice
IMPORTANT NOTICE This document has been prepared by National Australia Bank Limited ABN 12 004 044 937 (“NAB”) in relation to its proposed offer of NAB Capital Notes 4. A prospectus in respect of the offer of NAB Capital Notes 4 was lodged with ASIC on 17 February 2020 (“Prospectus”). The Prospectus
Slide 3: NAB at a Glance
NAB AT A GLANCE >34,000 ~9 million 892 >160 years For personal use only Employees Customers Branches/Business centres in operation Q120 CASH EARNINGS DIVISIONAL SPLIT1, 5 Key Financial Data FY19 (unaudited) Consumer Corporate & Banking & Institutional Cash Earnings1 $6.55 bn $1.65 bn Wealth 21% Bank
Slide 4: A Robust Balance Sheet... and 'Unquestionably Strong'
A ROBUST BALANCE SHEET... AND ‘UNQUESTIONABLY STRONG’ For personal use only COMMON EQUITY TIER 1 (CET1) NET STABLE FUNDING RATIO 0.1 1.2 0.1 1.0 0.1 0.8 0.1 0.6 0.1 10.6% 115% 113% 112% 113% 112% 10.4% 10.4% 0.4 0.1 10.2% 10.2% 0.2 0.1 0.1 - Mar 18 Sep 18 Mar 19 Sep 19 Dec 19 Mar-18 Sep-18 Mar-19 Se
Slide 5: Overview of NAB Capital Notes (NCN4) Offer
OVERVIEW OF NAB CAPITAL NOTES 4 (“NCN4”) OFFER Issuer National Australia Bank Limited (“NAB”) For personal use only Offer Size $750 million, with the ability to raise more or less Margin and Term Expected to be 2.95% - 3.15% Perpetual: Optional call ~7.5 years; Mandatory call ~9.5 years (See
Slide 6: Overview of NCN4 Terms
OVERVIEW OF NCN4 TERMS Type of Security Mandatorily convertible, subordinated, perpetual notes directly issued by NAB Not guaranteed or secured, not protected accounts and are not deposit liabilities Face Value $100 per NCN4 For personal use only Distributions Key features of Distributions:
Slide 7: Key Dates
KEY DATES1 Key Dates for the Offer Date For personal use only Record Date for Securityholder Offer and Reinvestment Offer (7.00pm Melbourne time) 12 February 2020 Announcement of the Offer and lodgement of Prospectus with ASIC 17 February 2020 Bookbuild 17-24 February 2020 Announcement of Margin 25
Slide 8: Options Available for Eligible NCN Holders
OPTIONS AVAILABLE FOR ELIGIBLE NCN HOLDERS Option 1: Reinvest your NCN Resale Proceeds into NCN4 under the Reinvestment Offer You may participate in the Reinvestment Offer by submitting an Application Form directly to NAB or through your Syndicate Broker: For personal use only Allocation Preferenc
Slide 9: Events That May Occur While NCN4 Are on Issue
EVENTS THAT MAY OCCUR WHILE NCN4 ARE ON ISSUE NCN4 do not have a fixed maturity date but there are certain events that could occur while NCN4 are on issue which may result in NCN4 being Converted into Ordinary Shares, Redeemed, Resold or purchased for cash, or Written Off. If none of these event
Slide 10: Events That May Occur While NCN4 Are on Issue (cont.)
EVENTS THAT MAY OCCUR WHILE NCN4 ARE ON ISSUE1 (cont.) Is APRA Do In what form will that NCN4 What value will a Holder Event When? approval conditions value be provided to impacted? receive for each NCN4? required? apply? Holders? For personal use only On 17 September 2029 or the next Distribution M
Slide 11: Mandatory Conversion
MANDATORY CONVERSION NCN4 Scheduled Mandatory Conversion Date: 17 September 2029 Mandatory On the Mandatory Conversion Date, NAB must Convert all outstanding NCN4 into Ordinary Shares provided that the Mandatory Conversion Conversion Conditions are satisfied. For personal use only If any of the
Slide 12: Loss Absorption Events
LOSS ABSORPTION EVENTS NCN4 have certain loss absorption features, which may be Common Equity Trigger Event triggered where NAB encounters severe financial difficulty: For personal use only • A Common Equity Trigger Event occurs when NAB or APRA determines Loss A Loss Absorption Event is each of:
Slide 13: Buffers and Pre-emptive Actions to Protect NCN4 Holders
BUFFERS AND PRE-EMPTIVE ACTIONS TO PROTECT NCN4 HOLDERS NAB’s capital position and earnings The Capital Conservation Buffer (CCB) restricts the ability to distribute earnings provide a buffer for NCN4 holders (including payment of dividends, discretionary bonuses and Additional Tier 1 Capital distri
Slide 14: Distributions
DISTRIBUTIONS 1. Expected to pay quarterly, floating rate Distributions Distribution Scheduled to be paid quarterly on 17 March, 17 June, 17 September, and 17 December, commencing on 17 June 2020 until the date that NCN4 Payment Dates are Converted or Redeemed. Distribution Rate The Distribution
Slide 15: Comparison of NCN4 to Other NAB Instruments
COMPARISON OF NCN4 TO OTHER NAB INSTRUMENTS1 NAB Subordinated NCN, NAB Capital Notes 2, NAB Capital Feature Term deposit National Income Securities Ordinary Shares Notes 2 Notes 3, NCN4 For personal use only Capital classification None Tier 2 Capital Additional Tier 1 Capital2 Additional Tier 1 Capi
Slide 16: Ranking Upon Winding Up
RANKING UPON WINDING UP Examples Examples of existing NAB obligations and securities1 Higher Ranking For personal use only Savings accounts and term deposits Liabilities preferred by law Employee entitlements and secured debt Secured liabilities and covered bonds Unsubordinated unsecured Bon
Slide 17: About NAB
For personal use only ABOUT NAB
Slide 18: Performance Summary
PERFORMANCE SUMMARY Financial Results FY141 FY151 FY16 FY17 FY18 FY19 For personal use only Cash earnings ($m)2 5,055 6,222 6,483 6,642 6,4936 6,5456 NIM 1.91% 1.90% 1.88% 1.85% 1.85% 1.78% Cash ROE 11.6% 14.8% 14.3% 14.0% 13.3%6 12.7%6 Balance Sheet Sep 14 Sep 15 Sep 16 Sep 17 Sep 18 Sep 19 CET1 ra
Slide 19: Our Roadmap for Sustainable Change
OUR ROADMAP FOR SUSTAINABLE CHANGE1 APRA SELF-ASSESSMENT RESPONSE ROYAL COMMISSION RESPONSE For personal use only • Enterprise-wide program led by ELT, overseen by NAB Completed 5 • Small business protections Board, with 150-strong working group Extended the protections of the Code to Small Business
Slide 20: Key Risks
For personal use only KEY ABOUT RISKS NAB
Slide 21: Summary of Key Risks of Investment in NCN4
SUMMARY OF KEY RISKS OF INVESTMENT IN NCN41 NCN4 are not deposit NCN4 do not constitute Protected Accounts or deposit liabilities for the purposes of the Banking Act or any other accounts with NAB liabilities or Protected and are not guaranteed or insured by any person. Accounts Distributions may
Slide 22: Summary of Key Risks of Investment in NCN4 (cont.)
SUMMARY OF KEY RISKS OF INVESTMENT IN NCN41 (cont.) NCN4 are perpetual and NCN4 have no fixed maturity date but will Convert into Ordinary Shares on 17 September 2029 if they are still on issue on that date and may not Convert if the Mandatory Conversion Conditions are satisfied. If these conditio
Slide 23: NCN4 Key Contacts
NCN4 Key Contacts Issuer – NAB Arranger and Joint Lead Manager – NAB Cat Meharry Nicholas Chaplin For personal use only Group Treasurer Head of Hybrid and Structured Capital Origination Mobile: +61 (0) 436 913 161 Phone: +61 (02) 9237 9518 E-mail: Catriona.Meharry@nab.com.au Email: Nicholas.Chaplin@
Slide 24: Thank You
For personal use only THANK YOU
National Australia Bank — Debt Investor Presentation (February 2020) on 6ix