National Australia Bank topped up its capital with the sale of two varieties of perpetual debt to Deutsche Bank.The first, for $300 million, are perpetual capital instruments that pay a spread of two percentage points over the 30-day bank bill rate. Deutsche, or the holder, may convert the debt to equity from July 2009. This debt counts as "innovative tier one" capital under APRA's definition.The second, also for $300 million, and which also pays a spread of two percentage points over the bill rate, is stapled to a preference share and counts as "non-innovative" capital. This debt is also convertible to ordinary shares, this time from September 2009.NAB sold $600 million in convertible notes (similar to the first tranche described above) to Deutsche Bank in December 2007. On that occasion the spread over bills was one percentage point. The holder of those notes (whether that was still Deutsche is unclear) converted them to ordinary shares yesterday.