Commonwealth Bank of Australia yesterday announced an offer, and lodged a prospectus with the ASX, for a new Tier 1 hybrid to be known as CommBank PERLS X Capital Notes.  The notes will pay an expected margin of between 3.40 per cent and 3.60 per cent above the bank bill rate. CBA said the offer is expected to raise A$750 million, "with the ability to raise more or less". In more precise terms, PERLS X are subordinated, unsecured notes scheduled to pay floating rate distributions quarterly, which are expected to be fully franked. These PERLS X notes have a call date of 15 April 2025 and will mandatorily exchange into ordinary shares on 15 April 2027 (subject to certain conditions). PERLS X have an initial face value of A$100. CBA's initial announcement stated that "net proceeds of the offer will be used to fund the banking group's business". The offer will comprise:•     a broker firm offer made to retail investors who are clients of a syndicate broker and certain institutional investors; and•      a securityholder offer made to eligible securityholders of ordinary shares, PERLS VI, PERLS VII, PERLS VIII or PERLS IX as at 9 March 2018.Commonwealth Bank of Australia is the arranger and a joint lead manager to the offer, while ANZ Securities Limited, Morgan Stanley Securities Australia Limited, Morgans Financial Limited and Westpac Institutional Bank have also been appointed as joint lead managers to the offer. Crestone Wealth Management Limited, Ord Minnett Limited and Shaw and Partners Limited have been appointed as co-managers to the offer. On the mandatory exchange date, holders will receive for each PERLS X a variable number of Ordinary Shares with a value approximately equal to A$101.018.  Distributions may be unfranked or not fully franked. If a distribution is unfranked or not fully franked, the cash distribution will be grossed-up according to a formula under the terms.  The number of ordinary shares is based on the face value (initially A$100) and the VWAP of ordinary shares during the 20 business days before the mandatory exchange date with the benefit of a one per cent discount. This may differ from the price of ordinary shares on or after exchange, and therefore the value of ordinary shares received on exchange of each PERLS X may be more or less than A$101.01.