hybrids

While APRA’s proposed hybrid phase out is designed to improve the resilience of the financial system, it will inevitably impact investors and the strategic plans that some advisers have laid out. Navigating the transition will require forethought.

It’s odd that of the 12 published submissions to APRA’s consultation on hybrids, not one advocated getting rid of them altogether. Is the regulator trying to protect banks and retail investors from themselves, or is it simply “jumping at shadows”?

The hybrid securities market felt the brunt of the COVID-19 crisis in March, when two issues were withdrawn and another issuer deferred redemptions. But last week Macquarie Bank relaunched its hybrid offer, offering a substantially higher margin than the rate on offer a few months ago. Macquarie Bank Capital Notes 2 was originally launched on…