The latest big-bank hybrid issue, CommBank PERLS XV Capital Notes, looks like being priced at a significantly tighter margin than pricing of the last round of issues in June.

Commonwealth Bank has launched PERLS XV, seeking A$750 million or more of capital. The hybrid securities are perpetual, subordinated, unsecured notes that will pay floating rate distributions set at a margin between 285 basis points and 300 bps over the three-month bank bill swap rate (currently around 2.9 per cent).

The notes have a first call date of June 2028 and a mandatory conversion date of June 2031.

If CBA is able to price the offer at the lower end of its indicative margin range, it will only pay 10 bps more for tier 1 hybrid capital than it did when it issued PERLS XIV in March.

The two issues are not completely like-for-like. PERLS XV has a June 2028 first call date, while PERLS XIV has a June 2029 first call date.

CBA will be paying significantly less than other recent issuers. Westpac issued Capital Notes 9 in June with a margin of 340 bps over the three-month bank bill rate.

NAB and Macquarie Group also issued hybrids in June. NAB paid a margin of 315 bps for $2 billion of capital and Macquarie paid a margin of 370 bps for $750 million of capital.

And CBA will be paying a lot less than MyState Ltd, which issued $65 million of hybrids in August at a margin of 550 bps over three-month BBSW.

CBA’s offer includes a reinvestment offer for holders of PERLS VII. The bank will redeem outstanding PERLS VII notes in December.

Credit market researcher BondAdviser said PERLS XV’s indicative pricing represented fair value, if on “the rich side” of fair value compared with other recent issues.

“This is understandable, given the small issue size and large amount of reinvestment demand from PERLS XIV holders,” it said.