https://www.hl.co.uk/shares/shares-sear ... -sub-notes
I this security and wondered whether anyone knew why NatWest would convert it into c.8% prefs? Surely the lower rate is better for them?
I appreciate that they might not longer receive a tax deduction for the interest but at current corporation tax rates that is only worth 19% - which is less than they would save!
Rthak
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NATW 11.5%
Re: NATW 11.5%
Let me start again - not sure what happened to my English on the post above.
I hold some 11.5 per cent. Undated Subordinated Notes convertible into 200,000,000 8.392 per cent. Non-cumulative Preference Shares of £1 each. The prospectus is here: https://investors.natwestgroup.com/~/me ... 078535.pdf
I wondered whether anyone knew why NatWest have not exercised their conversion option to convert these notes into 8.392% non cumulative preference shares of £1 each? Surely the lower rate is better for them?
I appreciate that they might no longer receive a tax deduction for the interest on the 11.5% bond but at current corporation tax rates that is only worth 19% - which is less than they would save!
Any thoughts greatly appreciated.
Rthak
I hold some 11.5 per cent. Undated Subordinated Notes convertible into 200,000,000 8.392 per cent. Non-cumulative Preference Shares of £1 each. The prospectus is here: https://investors.natwestgroup.com/~/me ... 078535.pdf
I wondered whether anyone knew why NatWest have not exercised their conversion option to convert these notes into 8.392% non cumulative preference shares of £1 each? Surely the lower rate is better for them?
I appreciate that they might no longer receive a tax deduction for the interest on the 11.5% bond but at current corporation tax rates that is only worth 19% - which is less than they would save!
Any thoughts greatly appreciated.
Rthak
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Re: NATW 11.5%
Perhaps because as of 2026, Prefs will no longer count toward regulatory capital.
Last week, I sold most of my Prefs for that reason.
V8
Last week, I sold most of my Prefs for that reason.
V8
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