NAB - National Australia Bank

[Bill M]

And, the uptake details are out


NAB closed the institutional raising and has expanded the retail component of the issue from $500m to $1.25bn.

This was a disappointing capital raising for us shareholders. I put in for 30K worth and all they allotted me was 279 shares with a value of $3,947.85. I wish they could have given us an opportunity just like the institutional investors.

 

[qldfrog]

This was a disappointing capital raising for us shareholders. I put in for 30K worth and all they allotted me was 279 shares with a value of $3,947.85. I wish they could have given us an opportunity just like the institutional investors.

Bill, you are far from the 0.001pc, you will have to do with the pittance as we do all;-)

 

[Dona Ferentes]

If you want to be in NAB you could do worse than NABHA which sits ahead of NAB when it eventually goes a-up.

I've been buying them in the low $80's mid $70's for years now, holding them for 3-4 years more as a proxy for cash type security and then selling them when they get in to the mid $90's. I bought some again quite recently. They are $100 securities and pay 1.5% above the cash rate at $100 unfranked

the fixed rate NABHA pays has been a winner as floating rates come down. Technically it's open ended but I thought it was soon to be paid back @ face value. And as a subordinated debt, it's higher than the new Capital Notes.

 

[qldfrog]

Nabha has indeed been good to me too.fully out

 

[Dona Ferentes]

This was a disappointing capital raising for us shareholders. I put in for 30K worth and all they allotted me was 279 shares with a value of $3,947.85. I wish they could have given us an opportunity just like the institutional investors.

It would be a nice arrangement if a formula could be arrived at, whereby new shares are allocated to reflect Time Held as well as number of shares, in any entitlement consideration. This would reweight allocation towards long term holders.

 

[Bill M]

Technically it's open ended but I thought it was soon to be paid back @ face value.

They have been saying that for years. Held them for quite a few years and rumours were going around that they would convert 5 years or more ago, never happened. I got fed up and in the end sold out at square. From memory they pay 1.25% + the 3 Month BBSR which at today's rate would equal about 1.35%. It isn't that flash an income even after the current 12% discount to face value. Buying at $56 during the GFC would have given you some nice returns but at $88 no thanks.

 

[Garpal Gumnut]

It would be a nice arrangement if a formula could be arrived at, whereby new shares are allocated to reflect Time Held as well as number of shares, in any entitlement consideration. This would reweight allocation towards long term holders.

To be honest I find it hard to wrap my head around when these will be redeemed at face value.

I guess when the volume and price goes up dramatically. (when the bloke at NAB who makes the decision let's his granny know.)

Then a few days later he will let everyone else know.

Why I follow chart. NABHA

gg

 

[PZ99]

This was a disappointing capital raising for us shareholders. I put in for 30K worth and all they allotted me was 279 shares with a value of $3,947.85. I wish they could have given us an opportunity just like the institutional investors.

I'm assuming the 279 shares is based on how many shares you hold ?

Bit unfair for them to restrict you to just a fraction otherwise.

 

[Bill M]

Bit unfair for them to restrict you to just a fraction otherwise.

Yes it was because there was no real formula or guarantees but they put it out there for you to buy up to 30K worth. (I only had 1000 NAB shares). Oh well they are holding my 26k refund right now, earning interest for themselves, still haven't got it back.

 

[Dona Ferentes]

I'm assuming the 279 shares is based on how many shares you hold ?

Bit unfair for them to restrict you to just a fraction otherwise.

from the NAB website,

How was the scaleback calculated?

NAB received valid SPP applications for a total value of A$2.9 billion. Given the strong support, NAB decided to increase the SPP size by A$750 million above its original target of A$500 million, which required a scale back to A$1.25 billion. As anticipated in NAB’s announcement on 4 May 2020, the scale back was applied having regard to the pro rata shareholding of Eligible Shareholders who applied for SPP Shares (as at 7.00pm on Friday 24 April 2020), subject to a minimum allocation of 176 SPP Shares (being A$2,490.40 worth of SPP Shares). Eligible Shareholders who applied for A$2,500 or less of SPP Shares will not be subject to any scale back and will receive the amount they applied for, rounded down to reflect a whole number of SPP Shares.

 

[sptrawler]

Yes it was because there was no real formula or guarantees but they put it out there for you to buy up to 30K worth. (I only had 1000 NAB shares). Oh well they are holding my 26k refund right now, earning interest for themselves, still haven't got it back.

I didn't apply, as you say they hold onto you dough for quite a long time and usually a major capital raising is scaled back massively well every one I have applied for has.
The other thing that usually happens, but didn't this time, is the share price normally falls to the issue price or thereabouts.

 

[Sharkman]

This was a disappointing capital raising for us shareholders. I put in for 30K worth and all they allotted me was 279 shares with a value of $3,947.85. I wish they could have given us an opportunity just like the institutional investors.

apologies in advance for this post, you'll probably hate me now, but i was one of the lucky ones who got the full allocation (2,120 units).

wonder how many orders for 21 contracts we'll see on the call side tomorrow. i know there'll be at least one... mine

 

[sptrawler]

apologies in advance for this post, you'll probably hate me now, but i was one of the lucky ones who got the full allocation (2,120 units).

wonder how many orders for 21 contracts we'll see on the call side tomorrow. i know there'll be at least one... mine

How did you manage that? Sophisticated investor?

 

[Sharkman]

How did you manage that? Sophisticated investor?

hah no, i would be anything BUT sophisticated!

i have a decent sized holding, but i wouldn't have thought i have anywhere near enough to not suffer any scaleback at all. i suspect it's not so much the holding size but more to do with my units being held in a nominee account. so it's possible that the broker was permitted to obtain allocations based on the holdings of their entire client base, but after the pro rata scaleback was applied, if there were any customers who didn't accept the offer, they could allocate the units that would have gone to those customers towards the customers who did accept, up to $30K max per client account. perhaps i have cutz to thank in that case, as maybe part of his allocation went to me instead!

my parents have a larger holding than i do, but theirs is in a CHESS account rather than a nominee account. next time i call them i might check if they got the full allocation too (though i'm not sure if they actually went for the SPP or not). if they didn't get the full allocation, then that would support this theory.

 

[Bill M]

apologies in advance for this post, you'll probably hate me now, but i was one of the lucky ones who got the full allocation (2,120 units).

wonder how many orders for 21 contracts we'll see on the call side tomorrow. i know there'll be at least one... mine

Nup, all good and very happy someone got some decent allocation. And what you are planning to do today was what I was hoping to do on a smaller scale as well. Good on ya!

 

[Ferret]

orders for 21 contracts we'll see on the call side

Hi Sharkman and congratulations.

I assume you are saying you plan to sell some, but can you please educate me and explain what the quoted phrase means?

 

[Sharkman]

Hi Sharkman and congratulations.

I assume you are saying you plan to sell some, but can you please educate me and explain what the quoted phrase means?

no problem. it's referring to those who wanted to participate in the SPP because they felt it was at a good price but don't want to increase their long term exposure to the stock (like me) looking to get rid of the extra units by having them called away instead of selling the units directly, ie. selling covered call options where the SPP units become the collateral.

1 contract is generally over 100 units of underlying (but not always eg. BHP Jun series is 104), so 21 contracts would basically cover the whole SPP allocation for those who were fully allocated (2,120 units as written above). i'm just curious as to how many other investors are looking to do the same thing so i'll be taking a bit of a peek down the option chains when the market opens to see how many sell orders for 21 call contracts i can spot (other than my own of course!)

the main benefit is you get to collect a fair amount of premium on top of what looks like (so far) decent cap gains on the SPP units, especially with volatilities at heightened levels pushing up the option prices. i estimated ~5.5% of the stock price for a 1 month expiry in an earlier post above, vols today aren't quite as high as the 50 or so that they were at the time due to the astonishing rally we've had (vols tend to drop when the market goes up), but at high 20s they are still well above historical norms, which for NAB tends to float in the 14-16 range.

 

[Sharkman]

very early in the session so far, MMs haven't even started posting their spreads yet but can see a couple of orders on deep ITM Jul calls for 8 and 10 contracts, wonder if those are SPP allocation units and they want the best chance they can get to ensure it gets called away. was planning to go ATM/slight ITM myself to collect more decay, but will see what happens when the MMs start showing spreads and the orders start flooding in.

 

[Ferret]

Thanks Sharkman. Always good to learn something!

 

[Sharkman]

Thanks Sharkman. Always good to learn something!

not at all. though if you are planning on doing something similar in the future, don't do what i just did - try to nip off too much of the spread when it's already at a price you're very happy with - they wouldn't fill me at the mid and i refused to budge.

i eventually did end up getting a good fill (MM even crossed to my side of the spread - 0.78 into a 0.70/0.83) but due to the post open pullback, had to go one strike lower as i wanted slight ITM, since i do kinda want these things called away.

and naturally, it's now rallying again. i mean it's all house money at this point given the cost base of those units is 14.15, but you still want the best outcome that you can get, and i flubbed that one rather badly because of my greed.