Banking Day reported on Tuesday on a Basel III-compliant, subordinated debt issue by Bendigo and Adelaide Bank that was set to test institutional investors in the wholesale corporate bond market. BEN was seeking to issue up to A$200 million or more of notes with non-cumulative coupons and a non-viability trigger that, if pulled, would convert the notes into ordinary shares in the bank.Basel III-compliant, subordinated debt was issued three times in the retail corporate bond last year, but Bendigo and Adelaide's issue is a first for the wholesale market. While provision was made for institutional investor participation in the retail issues undertaken last year, the level of participation in the deals has not been revealed and is thought to have been modest at best.Up until now, the general view among institutional investors was that the risk-reward profile of these deals was unattractive. Moreover, many institutional investment mandates prevent convertible notes, or the proceeds from conversion, being held.These features of Basel III-compliant, subordinated debt were expected to challenge institutional investors' take-up of the issue.As it was, the deal was upsized to A$300 million and the margin on the coupon set at 280 basis points over the 90-day bank bill the day before. It was all too easy. The indicative range for the margin was 285 to 300 bps.It appears that investors have come to grips with the features of these issues that were previously considered unattractive.Can it be concluded, therefore, that Bendigo and Adelaide has set the benchmark for future Basel III-compliant, subordinated debt issuance in the wholesale corporate bond market, and thereby ensured that the retail market is unlikely to see much issuance of this type in the future? After all, issuance of old-style subordinated debt, without deferrable coupons and non-viability triggers, was restricted to the wholesale market.It seems premature to conclude that Bendigo and Adelaide has set a precedent. When one of the major banks sells A$1.0 billion or thereabouts of Basel III-compliant, subordinated debt in the wholesale corporate bond market as easily as BEN sold its debt then it can be concluded that BEN did indeed pave the way for the product's return.The fact is that while some investors have accepted the features of the new-style subordinated debt, and also that this is all that is going to be available from now on, others have not. These investors will need to be brought on board for any large-volume transaction to succeed.The success of the bank's issue is attributable to the composition of its lead management team. The lead managers were National Australia Bank, Nomura and Goldman Sachs.The involvement of NAB brought broad market credibility to the transaction. While Nomura and Goldman Sachs brought their private bank clients, Asian and domestic, to the deal. They are not known for being particularly active in the wholesale corporate bond market.Bloomberg league table data shows that Nomura was lead manager in only 17 issues out of 360 last year, accounting for just 3.6 per cent of the face value of all bonds