Westpac Sets AUD 1.16 Quarterly Payout on Capital Notes 10
Westpac Banking Corporation has announced a fully franked quarterly distribution of AUD 1.1616 per Capital Note 10, reflecting a 4.66% annualised yield based on current benchmark rates.
- Distribution of AUD 1.1616 per Westpac Capital Note 10
- Annualised distribution rate of 4.6592%, fully franked
- Payment scheduled for 22 December 2025
- No external approvals required for distribution
- Distribution rate tied to 3-month BBSW plus fixed margin
Westpac Declares Quarterly Distribution on Capital Notes 10
Westpac Banking Corporation has announced a quarterly distribution payment of AUD 1.1616 per Westpac Capital Note 10 (WCN 10), scheduled for 22 December 2025. This distribution is fully franked, providing investors with a tax credit reflecting the corporate tax already paid by Westpac.
Distribution Rate and Calculation
The distribution rate for this period, spanning 23 September to 22 December 2025, is set at an annualised 4.6592%. This figure is derived from the 3-month Bank Bill Swap Rate (BBSW) of 3.5560% as of 23 September 2025, plus a fixed margin of 3.10%, adjusted for the Australian corporate tax rate of 30%. The calculation ensures that investors receive a return that reflects prevailing market interest rates while accounting for tax considerations.
Investor Implications and Payment Details
Investors holding WCN 10 securities can expect the distribution payment on 22 December 2025, with the ex-date and record date set for 11 and 12 December respectively. Importantly, Westpac has confirmed that no additional approvals, such as security holder or regulatory consents, are required for this distribution, underscoring the routine nature of this payment within the bank's capital management framework.
Context Within Westpac’s Capital Strategy
Capital Notes like WCN 10 are a key component of Westpac’s capital structure, providing a hybrid form of funding that supports the bank’s regulatory capital requirements. The fixed margin set at issuance and the linkage to the BBSW rate allow Westpac to manage its cost of capital effectively while offering investors a competitive yield. The fully franked nature of the distribution adds an attractive tax benefit for Australian investors.
Looking Ahead
While this distribution aligns with expectations, it remains subject to Westpac’s discretion and certain payment conditions, which could influence future payments. Investors should monitor subsequent announcements for any changes in distribution policy or market conditions that may impact returns.
Bottom Line?
Westpac’s steady distribution on Capital Notes 10 highlights its ongoing commitment to balancing investor returns with prudent capital management.
Questions in the middle?
- Will Westpac maintain or adjust the margin on future Capital Note issuances?
- How might changes in the BBSW rate affect upcoming distribution payments?
- What conditions could lead Westpac to withhold or defer distributions on these notes?
