RNS Number:6644L
National Australia Bank Ld
29 May 2003







ASX Announcement








                                               Melbourne - Thursday, 29 May 2003



National's Euro600 million subordinated note issue



On Friday, 23 May 2003, the National launched a fixed/floating 12 year, non call
7 year lower tier 2 subordinated euro medium term note issue on the following
terms:



Amount:                       Euro600 million



Lead Managers:                UBS Warburg & Deutsche Bank



Payment Date:                 4 June 2003



Maturity Date:                4 June 2015 (callable in 2010)



Benchmark:                    Bund 5.375% due January 2010



Re-off spread:                Benchmark plus 65.7bps



Coupon:                       3.875% annual / EURIBOR plus 49bps
                              Step up to EURIBOR plus 99bps in year 7 if
                              not called



Issue Rating:                 AA-/A1 (Subordinated)



Re-offer/Issue Price:   99.879



Comment



The proceeds of the issue will be used in the National's Australian balance
sheet for general banking purposes. The issue constitutes Tier 2 capital for the
Group and replaces some of the subordinated debt which has been called during
the course of this financial year.



The National successfully tapped into a new investor base with this inaugural
fixed rate Euro transaction. The Notes were sold predominantly to fund managers,
insurance companies and pension funds (80%) throughout Europe (73%), U.K. (19%)
and Asia (8%.)



Strong demand for highly rated subordinated debt led the issue to be
oversubscribed at EUR760 million and a quality book of EUR600 million was
ultimately built with 63 investors. The National took advantage of strong market
conditions and its AA-/A1 subordinated rating and priced competitively at a
re-offer of EURIBOR plus 49bp.



For further information, please contact:



Ian Mclean                                Michael O'Neill
Head of Group Funding & Liquidity         Head of Group Balance
Sheet Management
(03) 8641 3358                            (03) 8641 0021




                      This information is provided by RNS
            The company news service from the London Stock Exchange
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