Investec places over R1bn in subordinated debt

Investec has placed in excess of R1 billion in five different bond issues between April and October this year.

Saabir Karim of Investec Financial Products said that since April the specialist banker has been issuing subordinate debt that was fully Basel III compliant as they contained the SARB-prescribed provisions.

Investec chief executive Stephen Koseff. Photo: Simphiwe Mbokazi. Credit: INDEPENDENT MEDIA

“Our bonds are structured as guided by the South African Reserve Bank (SARB) to make them currently‚ fully Basel III compliant as they contain the SARB-prescribed provisions. We’ve considered an alternative methodology where changes in the regulatory environment in the future could make instruments compliant at that point. The preference was to rather educate investors on what deems a bond to be compliant Tier II capital from a bank regulation perspective and raise capital on that basis.”

The notes were also explicitly rated in July 2012. - I-Net Bridge