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NAB banks on income securities

THE National Australia Bank hopes to raise up to $2 billion by means of an innovative investment scheme.

Rather then issue ordinary shares, the bank has offered National Income Securities that will be listed on the Australian Stock Exchange. The securities have no maturity date, so to realise the investment they must be sold on the ASX at the prevailing market price or privately.

For a minimum investment of $5,000, investors will enjoy an interest rate at 1.25 per cent per annum above the defined market rate. An interest rate of not less than 6 per cent per annum is guaranteed until May 2000.

National Income Securities have a par value of $100 comprising a fully paid debt security of $100 (Note) and an unpaid preference share. The components cannot be traded separately.

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