Mac Bank goes hybrid Macqurie bank will issue hybrid shares for the first time. Macquarie Group has become the latest bank to issue hybrid shares, outlining plans on Tuesday to raise up to $400 million in fresh funds to help boost its balance sheet. The issue kicks off the latest round of hybrid share raisings, after a flurry of issues last year by large companies that saw more than $7 billion sold to investors. Hybrid shares pay a set interest rate, which usually tracks the price of debt, and after a set period of time convert into ordinary shares. Given they have bond-like features, paying a predictable yield, this makes them attractive to retail investors in times choppy markets. The home grown investment bank will issue the Macquarie Capital Notes, which are fully paid, subordinated and unsecured instruments. The notes will be listed on the ASX and convert to ordinary Macquarie shares in June 2021. The notes will be issued with a face value of $100 each and provide investors with a semi annual distribution rate calculated as the 180-day Bank Bill Swap Rate plus a fixed margin. The margin is expected to be in the range of 4.0 per cent to 4.2 per cent to be determined under the book build. "The Macquarie Note Offer is consistent with Macquarie's strategy to manage its capital mix and maintain a diverse source of funding," Macquarie chief financial officer, Patrick Upfold, said. "Macquarie has a strong balance sheet with well diversified funding sources and minimal reliance on short term wholesale funding markets," he added. The notes will be sold to both institutional and retail investors and Macquarie has left the door open to raise more under the offer. Earlier this year Westpac more than doubled the size of its hybrid share offering to $1.25 billion, due to strong demand.