Fonterra has cut the interest rate on its NZDX-listed perpetual capital notes to 4.83% from 8.74% to reflect the lower official cash rate.
The dairy co-operative has $35.1 million worth of perpetual capital notes on issue.
The decrease is based on an almost 4.00% fall in the one year government stock rate since July last year, Fonterra said today, adding that the margin portion of the interest rate remains unchanged at 1.80%.
“This decrease is due to the RBNZ's cuts in OCR as a reaction to the global recession, cuts which have created a lower interest rate environment.”
The next quarterly interest payment on the notes is due to be made on 12 October 2009 to those holders registered on 2 October 2009.
Under the terms on which the perpetual capital notes were issued, the
interest rate is reset on 10 July each year.