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Abonner TD Bank Financial Group/TD Securities Inc.

TD Bank Financial Group/TD Securities Inc.

TD Securities & Grange Securities Ltd Launch Innovative Step-Up Callable CDO Squared Transaction for Australian Investors

London, November 4 (ots/PRNewswire)

Following the successful
completion of the recent Kosciuszko transaction, TD Securities and
Grange Securities Limited have teamed up again to launch what is
believed to be the first step-up callable CDO squared transaction
targeted at the Australian investor base.
The transaction, called Hotham, consists of A $54,200,000, AAA
rated, 5.5 year maturity, step up, callable, synthetic CDO-squared
Notes with 30% subordination and will be issued in early November.
Quarterly coupons, based on the outstanding principal amount, of
AUD-BBR-BBSW plus 1.00% for years 1, 2 and 3, 1.50% for year 4, 1.75%
for year 5 and 2.00% for the last six months are payable provided the
transaction has not been called. The transaction may be called at the
then outstanding principal amount with the first call at the end of
year 3 and annually thereafter.
"After the success of Kosciuszko, our previous transaction with TD
Securities, there was still unfilled demand so we were keen to follow
up with another offering. Hotham was attractively priced and cleverly
structured by TD Securities so we were able to fill the demand and
invite existing Kosciuszko holders to top up with Hotham. The lesson
learnt from these two deals is that the volume sold is heavily driven
by the quality of the transaction and its specific targeting to
market demand." says Moray Vincent, Director Debt Capital Markets at
Grange Securities.
Similar to Kosciuszko, the Hotham Notes pay interest and principal
in part based on the credit performance of a portfolio of eight
tailor-made, static, synthetic underlying CDO tranches. Each of the
underlying CDOs in turn have an anticipated BBB rating with reference
portfolios comprised of 75 equally weighted corporate, financial
institution and/or sovereign entities. The underlying CDOs have a
total reference portfolio notional amount of A$ 1.807 billion from
which a leveraged A$ 45.2 million tranche is used in the Hotham CDO.
The credit events for each underlying CDO reference entity are drawn
from the standard ISDA credit events i.e. bankruptcy, failure to pay,
restructuring, obligation acceleration and repudiation / moratorium.
"The incorporation of a step-up callable feature shortens the
investment duration sufficiently to be attractive to investors in the
current yield environment, yet provides sufficient value in the
structure to allow the payment of attractive coupons." says Philippe
Hatstadt, Managing Director, Credit Structuring Global Head, TD
Securities, London.
Grange a leading investment banking firm and one of the main
distributors of CDO product in Australia, with offices in Sydney,
Melbourne, Perth and Brisbane, provides services to private and
institutional investors, corporate clients and government authorities
throughout Australia and the Asia Pacific region.
Notes to the Editors:
The Toronto-Dominion Bank and its subsidiaries are collectively
known as TD Bank Financial Group. In Canada and around the world, TD
Bank Financial Group serves more than 13 million customers in three
key businesses: personal and commercial banking including TD Canada
Trust; wealth management including the global operations of TD
Waterhouse; and wholesale banking, including TD Securities. The
Toronto-Dominion Bank trades on the Toronto and New York Stock
Exchanges under the symbol "TD". TD Securities, the wholesale banking
division of the TD Bank Financial Group, provides a wide range of
capital market products and services to corporate, government and
institutional clients around the globe. Services include the
underwriting and distribution of new debt and equity issues,
providing advice on strategic acquisitions and divestitures, and
daily trading and investment execution.

Contact:

For further information: Jamie Spence, Vice President & Director, TD
Securities, phone +61-29619-8866 or email
jamie.spence@tdsecurities.com; Chris Hodgeman, Vice President &
Director, TD Securities, phone +65-6434-6002 or email
chris.hodgeman@tdsecurities.com; Mike Chacos, Managing Director, TD
Securities, phone +44-(0)207-786-8410 or email
michael.chacos@tdsecurities.com