The Bank of Montreal has announced:
that it has completed its offering of 11.6 million Non-Cumulative 5-Year Rate Reset Class B Preferred Shares Series 25 (the “Preferred Shares”) at a price of $25.00 per share. The gross proceeds of the offering were $290 million after the exercise in part of the underwriters’ option. The offering, which was previously announced on March 2nd, was underwritten on a bought deal basis by a syndicate led by BMO Capital Markets. The Preferred Shares commence trading on the Toronto Stock Exchange today under the symbol BMO.PR.Q.
The Preferred Shares were issued to the public at a price of $25.00 per Preferred Share and holders will be entitled to receive non-cumulative preferential fixed quarterly dividends for the initial period ending August 25, 2016, as and when declared by the board of directors of the Bank, payable in the amount of $0.24375 per Preferred Share, to yield 3.90 per cent annually.
Thereafter, the dividend rate will reset every five years to be equal to the 5-Year Government of Canada Bond Yield plus 1.15 per cent. Subject to certain conditions, holders may elect to convert any or all of their Preferred Shares into an equal number of Non-Cumulative Floating Rate Class B Preferred Shares Series 26 on August 25, 2016 and on August 25 of every fifth year thereafter. Holders of the Preferred Shares Series 26 will be entitled to receive non-cumulative preferential floating rate quarterly dividends, as and when declared by the board of directors of the Bank, equal to the then 3-month Government of Canada Treasury Bill yield plus 1.15 per cent.
The FixedReset 3.90%+115 was announced March 2.
The issue traded 388,199 shares in a tight range of 24.80-86 before closing at 24.80-86, 10×25.
Vital statistics are:
Maturity Type : Hard Maturity
Maturity Date : 2022-01-31
Maturity Price : 25.00
Evaluated at bid price : 24.80
Bid-YTW : 3.92 %
This issue will be tracked by HIMIPref™ has been added to the FixedResets index. A hardMaturity at par dated 2022-1-31 has been added to the call schedule indicated by the prospectus to reflect an anticipated call due to the issues lack of a NVCC clause and OSFI’s refusal to grandfather such issues.