Bank Bills?

[lazzaman]

I am currently in planning stage with an architect toward development of a double shop front I purchased recently (unencumbered if that is relevant) .
We have to decide if and what we put upstairs, as downstairs will be used as my business premises (currently renting down the way).
My preferred model is two residential apartments, as local agents tell me that office space is difficult to let in the area.
Needing to do the sums involved, I am exploring all modes of financing the project.
Would somenone please be able to tell me whether bank bills are a feasible instrument for financing such a venture anytime +/or in the current environment.

Thanks

lazza

 

[asdf]

Curious where you heard this from? Can you explain how this would work? You are issuing bills or debt guaranteed by the bank?? Even blue chip corporates are struggling to raise debt, I doubt you would be able to tap the CP market (no offence to your development). Bank bills in retail usually refers to investment, not lending. Perhaps theres a new product out there??

 

[lazzaman]

I may well have this all upside down, asdf, but I am sure I remember an acquaintance funding a farm purchase some years ago via bank bills and telling me I was mad if I didn't avail myself of them if I ever purchased investment property.

Then recently whilst doing my homework for this development, I came across the following on the Westpac business lending website:

Bank Bills

Bank bills cover your short- or long-term financial needs, and offer flexible repayment options. Access finance priced at Westpac's bill rate to meet all your fiscal requirements, including seasonal funding, new business acquisition, capital investment and refinance.

The Westpac bill rate is a variable rate determined by the bank. It is determined by a range of factors including, current market bank bill rates and the amount and tenor of the bank bill you select. You can protect interest rate exposure through a wide range of risk management products.

Optional redraw and progressive drawdown facilities are also available (applies only to variable interest rate).



Key features and benefits

Minimum and maximum amounts
Minimum Limit: $250,000
Maximum Limit: Nil.

Minimum and maximum terms
Bill tenors: 30 to 180 days
Facility terms: Up to 10 years.

Flexible repayment options
Interest only in advance (fixed rate loans only)
Interest only
Principal and interest
Can be monthly, quarterly, half yearly or annually (principal only).

Security
Residential property
Commercial property (non-specialised)
Business assets/other types of security.

Fees and charges
Line and/or acceptance fees apply
Bill rollover fees apply


Perhaps there is no interest rate advantage to be gained by using them, but I guess I need to ask them about that.
I had presumed that they would be an instrument that would be commonly used by people here.

 

[Token Funder]

The Westpac bill rate is a variable rate determined by the bank. It is determined by a range of factors including, current market bank bill rates and the amount and tenor of the bank bill you select. You can protect interest rate exposure through a wide range of risk management products.

You're not funding from "actual" bank bills, rather WP would providing a product priced directly off the prevailing BB rate for the term you're after, tweaked based on risk and exposure.