Interrogate your MP: Where do you stand on Glass-Steagall?

 4 May 2016

Vol. 18 No. 18

 https://gallery.mailchimp.com/0e711a75e092d068debcd1a03/files/AASVol18No18_Almanac12_email.pdf

 Westpac is preparing a hybrid bond issue worth around $1 billion in the next two weeks—bail-inable bonds which offer higher interest rates to raise desperately needed cash. The banks are having a party selling these bonds, sucking people in at a merry rate before APRA officially earmarks them for bail-in, able to be seized to prop up the banks.   APRA is writing the rules as it goes, and there’s no question who will be left carrying the can when the whole shebang goes up in smoke.

hybrid securities and notes...

https://www.moneysmart.gov.au/investing/complex-investments/hybrid-securities-and-notes

Hybrid securities and notes

Consider the features and risks

Hybrid securities (including subordinated notes, capital notes and convertible preference shares) may be from well-known companies, banks and insurers but they are very different from other fixed interest investments.

Some hybrid securities make investors take on 'equity-like' risks but only give them at best, 'bond-like' returns. Some have terms and conditions that allow the issuer to exit the deal or suspend interest payments when they choose. Others may convert into ordinary shares, or be written off completely if the issuer experiences financial difficulty.

Hybrid securities may not be suitable for you if you need steady returns or capital security.

• What are hybrid securities?
• The risks of hybrid securities
• Comparing hybrids to other investments
• Questions to ask