The Commonwealth Bank of Australia released a Pricing Supplement dated 19 May 2026 relating to the issue of EUR 1.25 billion subordinated notes under its U.S.$70 billion Euro Medium Term Note Programme. The announcement comes with an Appendix 2A lodged with the ASX on Thursday. The bank also said that the Information Memorandum in relation to the subordinated notes had been filed with ASX on 26 August 2025.
Figure 1: Commonwealth Bank headquarters building featuring the CommBank logo in Australia [Courtesy: Retail Banker International]
The notes carry an initial interest rate of 4.454 per cent per annum and mature on 21 May 2037. They were issued at par, meaning 100 per cent of face value.
CBA Subordinated Notes: What the Issuance Covers
The CBA EUR notes were issued on 21 May 2026. Interest payments fall annually on 21 May from 2027 through to maturity. The notes follow a Fixed Reset structure, benchmarked to the 10-year euro mid-swap rate plus an initial margin of 1.33 per cent per annum.
CBA holds an optional redemption date of 21 May 2036, one year before maturity. The Bank can call the notes with no less than 20 and no more than 60 calendar days’ notice. A Clean-Up Call option also applies.
Key Terms at a Glance
Syndication and Joint Lead Managers
The EUR 1.25 billion issuance was distributed through a syndicated arrangement. Five Joint Lead Managers managed the placement:
- Barclays Bank PLC
- Commonwealth Bank of Australia
- Natixis
- Societe Generale
- UBS AG London Branch
Notes are registered in global form via Euroclear and Clearstream, Luxembourg.
Regulatory and Structural Framework
The notes are subordinated and are limited to eligible counterparties and professional clients. MiFID II product governance excludes them from retail investors in the European Economic Area and the United Kingdom.
Interest rate is reset on 21 May 2036 against the 1-year Euro Mid-Swap Rate, plus a margin of 1.33 per cent per annum. Any changes or amendments to benchmark rates will need APRA’s prior consent in writing.
CBA’s Financial Position Ahead of the Issuance
CBA’s latest half-year result, for the half ending 31 December 2025, revealed that the Bank is performing operationally sound. Net statutory profit after tax was A$5,412 million, an increase of 5 per cent from the previous comparable period. Cash NPAT of A$5,445 million, up 6 per cent on the same basis.
Ordinary activities revenue for the period is up 6 per cent on the prior comparative period, to A$15,000 million. Pre-provision profit of A$8,131 million, up 5 per cent on the prior corresponding period.
H1 FY26 Financial Snapshot
Credit Quality and Funding Metrics
Loan impairment expense was A$319 million for the half year ended 31 December 2025, with a loan loss rate of only 6 basis points. Home loan arrears actually dipped by 7 basis points over the half, with an astounding 87 per cent of home loan customers ahead on their repayment schedule.
Provision to credit risk weighted assets continues to be strong at 1.55 per cent. CBA as at December 31, 2025, held around A$2.8 billion in excess of losses it would expect to incur under its main economic assumptions.
Deposit funding stood at 79 per cent of total funding as on 31 December 2025. Long-term wholesale funding made up 68 per cent of total wholesale funding, with a portfolio weighted average maturity of 5.2 years.
CBA ASX Share Price
Commonwealth Bank of Australia (ASX: CBA) is currently trading on the ASX with the following metrics:
- Last Price: A$164.590 per share
- Market Capitalisation: A$272.17 billion
- 52-Week Range: A$146.980 to A$192.000 per share
Figure 2: CBA share price performance on the ASX over the past year [Courtesy: ASX]
Industry Outlook
Structured debt programmes enable Australia’s major banks to still attract international institutional capital. Euro Medium Term Note market, the core of the international debt capital market lending continued to serve demand for many countries’ investment-grade issuers looking to diversify their funding base from domestic markets.
Australian banks have robust CET1 ratios, and the local economy is maintaining relatively resilient consumer demand and business lending. This is keeping European institutional investors interested in high-quality subordinated debt with clearly defined redemption timelines.
Future Direction and Impact on CBA Shareholders and Bondholders
The EUR 1.25 billion issuance extends CBA’s wholesale funding maturity profile and alleviates refinancing pressure in the next one or two years.
It shows existing shareholders the Bank is still open for business with deep access to international capital markets at a competitive price.
CBA is going to announce its full-year results on 12 August 2026 and the Annual General Meeting is scheduled to take place on 14 October 2026 in Sydney.
An interim dividend of A$2.35 (fully franked) per share payable on or about 30 March 2026 to shareholders registered at the close of business on 19 February 2026.
Frequently Asked Questions
Q1. What did CBA just issue?
Ans. The CBA issued EUR 1.25 billion in subordinated notes, maturing in 2037.
Q2. What rate do the notes pay?
Ans. 4.454 per cent per annum, paid annually.
Q3. Can CBA exit early?
Ans. Yes, from 21 May 2036 it can call early with at least 20 days notice.
Q4. How is CBA doing financially?
Ans. It is performing decently. The NPAT was recorded as A$5,412 million for the period ended 31 December 2025.
Q5. Who distributed the notes?
Ans. Barclays, Natixis, Societe Generale, UBS AG London Branch, and CBA itself.
Disclaimer
This article is meant for information only and, it does not represent financial advice, investment direction, or retirement planning suggestions. Readers are expected to consult a financial adviser before making any investment decisions. Colitco put together this material using publicly available company announcements, and it does not promise later commercial results, product availability, or investment performance tied to Commonwealth Bank of Australia or any related financial products.
Sources
https://announcements.asx.com.au/asxpdf/20260521/pdf/06ztp48tdg2cd4.pdf
https://www.asx.com.au/markets/company/CBA
https://www.commbank.com.au/about-us/investors/emtn-programme.html
Tags: Commonwealth Bank of Australia, Euro, Euro Medium Term, Subordinated Notes Last modified: May 21, 2026
