Rabobank Nederland to Sell Hybrid Contingent Notes

Rabobank Nederland, Europe’s biggest agricultural lender, is selling undated subordinated bonds that can be written down if its regulatory capital requirements fall below a preset threshold.

The perpetual Tier 1 notes in dollars, which can be repaid after 5 1/2 years, lose money if Rabobank’s consolidated equity capital ratio falls below 8 percent, according to Rogier Everwijn, the Utrecht, Holland-based lender’s head of long-term funding. The company last year issued 1.25 billion euros ($1.66 billion) of 6.875 percent senior notes due 2020 that can be written down by 75 percent and repaid immediately in a crisis.