Notes to the Financial Statements
6.4 Subordinated debt On 5 November 2020, the Company issued $75 million subordinated, unsecured notes (‘the Notes’) to wholesale investors. The Notes are unsecured, subordinated debt obligations of the Company. Interest on the Notes accrues at a variable rate equal to the three-month Bank Bill Swap Rate (‘ BBSW ’) plus a margin of 6% per annum, until maturity, payable quarterly in arrears. Interest expense recognised for the year ended was $7.7 million (2023: $6.6 million). The maturity date of the subordinated debt is 5 November 2030. Subject to APRA’s prior written approval and certain other conditions, the Notes are callable from November 2025 or if certain tax or regulatory events occur. The Company capitalised directly attributable costs associated with the issuance of the subordinated debt, which totalled $1.7 million and was incurred in FY21. These costs are amortised on a straight line basis of 5 years, being the lesser of the maturity date and the call date. Amortisation of these costs recognised for the year ended was $0.3 million (2023: $0.3 million) For the year ended 30 June 2024, total subordinated debt is as follows:
Consolidated
Company
2024 $'000 74,200
2023
2024 $'000 74,200
2023
$'000 73,857
$'000 73,857
Balance at the beginning of the financial year Amortisation of capitalised costs Balance at the end of the financial year
343
343
343
343
74,543 74,200 The Company has used $30 million of the proceeds of the Notes for regulatory capital purposes for ClearView Life Assurance Limited. The remainder of the proceeds was used by ClearView to repay existing debt and to cover associated costs. 74,200 74,543 The Subordinated Notes may convert into Ordinary Shares of ClearView on the occurrence of a Non-Viability Trigger Event. The number of Ordinary Shares issued on Conversion is variable but is limited to the Maximum Conversion Number. The Maximum Conversion Number is 147,058 Ordinary Shares per Subordinated Note, based on the Issue Date VWAP of $0.34.
6.5 Borrowings
Financing Facilities
Consolidated
Company
2024 $'000
2023
2024 $'000
2023
$'000
$'000
The Group has access to the following facilities: Bank Guarantees – amount used
2,854
2,850
—
—
Overdraft and credit – amount used – amount unused Bank Facility – amount used – amount unused
—
—
— —
— —
2,000
2,000
31,000
16,000
31,000
16,000
29,000 44,000
29,000 44,000
As at the reporting date, the Company had a $60 million facility agreement with the National Australia Bank. $31 million has been drawn down with the balance available for immediate use (30 June 2023: $16 million). $15 million was drawn down in the year to partly fund the FY23 final cash dividend. The facility is repayable on 1 August 2026. Interest on the loan accrues at BBSY plus a margin of 0.95% per annum (FY23: 0.95%), and is payable quarterly. Furthermore, a line fee of 0.75% per annum (FY23: 0.75%) is payable on the facility on a quarterly basis.
154
ClearView Annual Report 2024
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