The first Australian covered bonds were
issued last week, allowing all Australian banks, credit
unions and building societies to access cheaper sources of
funding, but there are tax implications, warn advisers.
Despite the positive effects, the introduction of
covered bonds will mean tax changes are required; otherwise the
taxes incurred could negate the benefits of covered bonds as a
source of funding.
The tax implications relate to consolidation, stamp
duty and non-resident withholding tax, but should be
manageable, say advisers.
Following Swan’s announcement on Wednesday,
Commonwealth Bank and ANZ Banking Group have completed covered
bond issues. ANZ has raised $1.25 billion (A$1.23 billion) from
US debt markets, while National Australia Bank is also expected
to complete covered bond issues...