Macquarie Bank Capital Notes

I have just received an offer to participate in the latest Macquarie Bank Capital Notes. It looks like a hybrid offer with yields at reference rate plus a margin of 3.3%, adjusted for franking. I am looking at it for my SMSF (in pension phase).

Do you think this is a worthwhile investment?

A: As part of a diversified portfolio of hybrid securities, the Macquarie offer is reasonable value.


Spreads have tightened considerably in the hybrid market - and I am not sure that they are going to come in any further. Even though this is 50bp higher than the recent issue by the CBA, I don't think this is an issue to load up on.


A cautious yes.



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