Clydesdale Bank delays IPO after ratings question

CYBG will start trading on the London Stock Exchange today and on the ASX as CHESS Depository Interests tomorrow, NAB said.

Clydesdale’s shares were priced at 180 pence yesterday.

National Australia Bank delayed the flotation of its United Kingdom subsidiary Clydesdale Bank on the London Stock Exchange by 24 hours following a “specific request” from an unnamed ratings agency.

“The Initial Public Offering is expected to proceed, with the IPO multiple times covered at 180 pence per CYBG share from global and Australian investors”, said NAB.

“While we have a very short delay in launching the IPO, it is very important that we commence trading as an independent company in the best possible way”, Clydesdale chief executive David Duffy said. It plans to list 25% of its shares, while rest of the shares is expected to be distributed to existing NAB shareholders.

“The deposit rating is utilised by certain secured funding programmes, which represent 13 per cent of CYBG’s total funding”.

‘The outcome of this assessment could be a near term downgrade of the short- and/or long-term deposit rating or the placing of such rating on credit watch with negative implications.

“The successful conclusion of the demerger and IPO of CYBG is a significant milestone for NAB that will enable us to pursue our own focused strategy in our core markets in Australia and New Zealand as we drive towards our vision of becoming Australia and New Zealand’s most respected bank”.

Investors will have another day to consider a revised IPO prospectus.

“The demerger allows each business to focus on improving performance in their home markets and on business priorities that will maximise value for their respective shareholders”, he said. The price gives Clydesdale and Yorkshire bank a market capitalisation of around $3.2 billion.