BCE.PR.O: No Conversion to FloatingReset

March 17th, 2017

BCE Inc. has announced:

that none of its fixed-rate Cumulative Redeemable First Preferred Shares, Series AO (Series AO Preferred Shares) will be converted into floating-rate Cumulative Redeemable First Preferred Shares, Series AP (Series AP Preferred Shares) on March 31, 2017.

On March 1, 2017, BCE notified holders of Series AO Preferred Shares that they could elect to convert their shares into Series AP Preferred Shares subject to the terms and conditions attached to those shares. Only 104,631 of BCE’s 4,600,000 Series AO Preferred Shares were tendered for conversion on March 31, 2017 into Series AP Preferred Shares. As this would result in there being less than one million Series AP Preferred Shares outstanding, no Series AO Preferred Shares will, as per the terms and conditions attached to those shares, be converted on March 31, 2017 into Series AP Preferred Shares.

The Series AO Preferred Shares will continue to be listed on the Toronto Stock Exchange under the symbol BCE.PR.O. The Series AO Preferred Shares will pay on a quarterly basis, for the 5-year period beginning on March 31, 2017, as and when declared by the Board of Directors of BCE, a fixed quarterly cash dividend based on an annual dividend rate of 4.260%.

Assiduous Readers will remember that I recommended against conversion after the reset to 4.26% for BCE.PR.O.

March 17, 2017

March 17th, 2017
HIMIPref™ Preferred Indices
These values reflect the December 2008 revision of the HIMIPref™ Indices

Values are provisional and are finalized monthly
Index Mean
Current
Yield
(at bid)
Median
YTW
Median
Average
Trading
Value
Median
Mod Dur
(YTW)
Issues Day’s Perf. Index Value
Ratchet 0.00 % 0.00 % 0 0.00 0 -0.8362 % 2,100.1
FixedFloater 0.00 % 0.00 % 0 0.00 0 -0.8362 % 3,853.6
Floater 3.62 % 3.79 % 51,513 17.88 4 -0.8362 % 2,220.9
OpRet 0.00 % 0.00 % 0 0.00 0 -0.0847 % 3,017.4
SplitShare 4.93 % 3.81 % 63,169 0.72 6 -0.0847 % 3,603.4
Interest-Bearing 0.00 % 0.00 % 0 0.00 0 -0.0847 % 2,811.5
Perpetual-Premium 5.35 % 2.81 % 69,042 0.09 20 -0.0020 % 2,743.4
Perpetual-Discount 5.16 % 5.19 % 96,356 15.10 16 0.0423 % 2,925.7
FixedReset 4.41 % 4.16 % 247,704 6.69 94 -0.1162 % 2,345.1
Deemed-Retractible 5.04 % 2.70 % 141,269 0.19 31 -0.0687 % 2,858.2
FloatingReset 2.47 % 3.21 % 51,314 4.60 9 0.0159 % 2,501.7
Performance Highlights
Issue Index Change Notes
BAM.PR.B Floater -1.27 % YTW SCENARIO
Maturity Type : Limit Maturity
Maturity Date : 2047-03-17
Maturity Price : 12.44
Evaluated at bid price : 12.44
Bid-YTW : 3.79 %
BAM.PR.K Floater -1.27 % YTW SCENARIO
Maturity Type : Limit Maturity
Maturity Date : 2047-03-17
Maturity Price : 12.44
Evaluated at bid price : 12.44
Bid-YTW : 3.79 %
CU.PR.C FixedReset -1.13 % YTW SCENARIO
Maturity Type : Limit Maturity
Maturity Date : 2047-03-17
Maturity Price : 21.56
Evaluated at bid price : 21.90
Bid-YTW : 4.20 %
GWO.PR.N FixedReset -1.00 % YTW SCENARIO
Maturity Type : Hard Maturity
Maturity Date : 2025-01-31
Maturity Price : 25.00
Evaluated at bid price : 15.83
Bid-YTW : 8.96 %
BIP.PR.A FixedReset 1.08 % YTW SCENARIO
Maturity Type : Limit Maturity
Maturity Date : 2047-03-17
Maturity Price : 22.61
Evaluated at bid price : 23.35
Bid-YTW : 5.08 %
Volume Highlights
Issue Index Shares
Traded
Notes
CU.PR.C FixedReset 200,100 YTW SCENARIO
Maturity Type : Limit Maturity
Maturity Date : 2047-03-17
Maturity Price : 21.56
Evaluated at bid price : 21.90
Bid-YTW : 4.20 %
IFC.PR.A FixedReset 159,816 YTW SCENARIO
Maturity Type : Hard Maturity
Maturity Date : 2025-01-31
Maturity Price : 25.00
Evaluated at bid price : 18.87
Bid-YTW : 7.24 %
GWO.PR.G Deemed-Retractible 96,684 YTW SCENARIO
Maturity Type : Hard Maturity
Maturity Date : 2025-01-31
Maturity Price : 25.00
Evaluated at bid price : 24.90
Bid-YTW : 5.26 %
BMO.PR.T FixedReset 90,409 YTW SCENARIO
Maturity Type : Limit Maturity
Maturity Date : 2047-03-17
Maturity Price : 22.01
Evaluated at bid price : 22.27
Bid-YTW : 4.01 %
BMO.PR.S FixedReset 86,535 YTW SCENARIO
Maturity Type : Limit Maturity
Maturity Date : 2047-03-17
Maturity Price : 22.30
Evaluated at bid price : 22.63
Bid-YTW : 4.03 %
GWO.PR.I Deemed-Retractible 76,073 YTW SCENARIO
Maturity Type : Hard Maturity
Maturity Date : 2025-01-31
Maturity Price : 25.00
Evaluated at bid price : 22.40
Bid-YTW : 6.19 %
There were 44 other index-included issues trading in excess of 10,000 shares.
Wide Spread Highlights
Issue Index Quote Data and Yield Notes
GRP.PR.A SplitShare Quote: 25.89 – 26.39
Spot Rate : 0.5000
Average : 0.3495

YTW SCENARIO
Maturity Type : Call
Maturity Date : 2017-04-16
Maturity Price : 25.00
Evaluated at bid price : 25.89
Bid-YTW : -22.19 %

BMO.PR.T FixedReset Quote: 22.27 – 22.46
Spot Rate : 0.1900
Average : 0.1170

YTW SCENARIO
Maturity Type : Limit Maturity
Maturity Date : 2047-03-17
Maturity Price : 22.01
Evaluated at bid price : 22.27
Bid-YTW : 4.01 %

CU.PR.C FixedReset Quote: 21.90 – 22.19
Spot Rate : 0.2900
Average : 0.2260

YTW SCENARIO
Maturity Type : Limit Maturity
Maturity Date : 2047-03-17
Maturity Price : 21.56
Evaluated at bid price : 21.90
Bid-YTW : 4.20 %

GWO.PR.N FixedReset Quote: 15.83 – 16.16
Spot Rate : 0.3300
Average : 0.2686

YTW SCENARIO
Maturity Type : Hard Maturity
Maturity Date : 2025-01-31
Maturity Price : 25.00
Evaluated at bid price : 15.83
Bid-YTW : 8.96 %

BAM.PF.H FixedReset Quote: 26.65 – 26.94
Spot Rate : 0.2900
Average : 0.2309

YTW SCENARIO
Maturity Type : Call
Maturity Date : 2020-12-31
Maturity Price : 25.00
Evaluated at bid price : 26.65
Bid-YTW : 3.10 %

BMO.PR.Y FixedReset Quote: 24.02 – 24.25
Spot Rate : 0.2300
Average : 0.1754

YTW SCENARIO
Maturity Type : Limit Maturity
Maturity Date : 2047-03-17
Maturity Price : 22.93
Evaluated at bid price : 24.02
Bid-YTW : 4.07 %

March 16, 2017

March 17th, 2017

Interesting article in the WSJ regarding the changing life insurance business:

Prudential Financial Inc. is about to become the largest life insurance company in America by assets. But U.S. life insurance sales aren’t the biggest source of its profits.

Today, many Americans say they fear outliving their savings more than the premature death of a major breadwinner. And industry sales of individual life-insurance policies are down sharply since the mid-1980s. As a result, Prudential has transformed itself into an investing giant focused heavily on retirement-related products and services.

Up next, PGIM is making its first foray into ETFs, according to people familiar with the matter. The firm aims to start with two types of ETFs: actively managed fixed-income products, and so-called smart beta equity ETFs, which track the performance of non-market-capitalization-weighted indexes, these people said.

The industry shift away from life insurance is in part the result of the proliferation of mutual funds in the 1980s, which opened the door to stock-market investing by middle-income households through tax-advantaged savings plans. Before then “whole life insurance,” combining a death benefit with a tax-advantaged savings account, was a common way to save.

Basic term-life policies picked up some of the slack as savings plans proliferated. But many agents quit the business because commissions were relatively small, further depressing sales.

prudentialincome
Click for Big

And there are housing woes even outside Canada:

In places such as New York and San Francisco, which offer the greatest array of high-paying jobs, rents and home prices have shot up beyond the reach of many young workers. The squeeze has even affected the Bay Area’s amply compensated technology workers, whose salaries often aren’t enough to offset the rapidly rising rents and housing costs.

Technology workers who own a home in Seattle, by contrast, can expect to have about $2,000 more of disposable income left over each month after paying housing costs and taxes than those who live in San Francisco, according to a new analysis by Zillow and LinkedIn Corp. released Thursday.

Seattle tech workers who own their homes keep an average of 59% of their incomes after housing and tax costs, while Bay Area tech workers pocket just 37%, according to the study. In Austin, workers hold on to 54% of their incomes if they rent and 62% if they own.

But Ontario is mulling the destruction of the condominium business, given the success of rent control in destroying the apartment market:

Ontario is developing “substantive rent control reform,” the housing minister said Thursday, as the provincial NDP push for tenants in newer units to have the same protections as all other renters.

Currently, annual rent increase caps only apply to residential buildings or units constructed before November 1991. This year the rent for those tenants could be increased by up to 1.5 per cent without the landlord applying to the Landlord and Tenant Board.

Ontario Housing Minister Chris Ballard said it’s “unacceptable” that many Ontarians are seeing dramatically increasing housing costs.

“My staff are already developing a plan to address unfair rises in rental costs by delivering substantive rent control reform in Ontario as part of an ongoing review of the Residential Tenancies Act,” Ballard said in a statement.

“In the days ahead, we’ll share more details about a transformative plan that will allow Ontarians, no matter their budget or community, to realize their dream of having an affordable place to call home.”

HIMIPref™ Preferred Indices
These values reflect the December 2008 revision of the HIMIPref™ Indices

Values are provisional and are finalized monthly
Index Mean
Current
Yield
(at bid)
Median
YTW
Median
Average
Trading
Value
Median
Mod Dur
(YTW)
Issues Day’s Perf. Index Value
Ratchet 0.00 % 0.00 % 0 0.00 0 -1.4422 % 2,117.8
FixedFloater 0.00 % 0.00 % 0 0.00 0 -1.4422 % 3,886.1
Floater 3.59 % 3.74 % 51,931 17.99 4 -1.4422 % 2,239.6
OpRet 0.00 % 0.00 % 0 0.00 0 0.0065 % 3,019.9
SplitShare 4.93 % 3.91 % 63,810 0.72 6 0.0065 % 3,606.4
Interest-Bearing 0.00 % 0.00 % 0 0.00 0 0.0065 % 2,813.9
Perpetual-Premium 5.35 % 2.17 % 69,733 0.09 20 -0.0234 % 2,743.4
Perpetual-Discount 5.16 % 5.20 % 95,992 15.10 16 0.0397 % 2,924.4
FixedReset 4.40 % 4.15 % 250,897 6.70 94 -0.0794 % 2,347.8
Deemed-Retractible 5.04 % 2.55 % 141,569 0.19 31 0.0317 % 2,860.2
FloatingReset 2.47 % 3.20 % 48,859 4.60 9 0.2968 % 2,501.3
Performance Highlights
Issue Index Change Notes
TRP.PR.B FixedReset -2.16 % YTW SCENARIO
Maturity Type : Limit Maturity
Maturity Date : 2047-03-16
Maturity Price : 14.51
Evaluated at bid price : 14.51
Bid-YTW : 4.29 %
BAM.PR.B Floater -2.02 % YTW SCENARIO
Maturity Type : Limit Maturity
Maturity Date : 2047-03-16
Maturity Price : 12.60
Evaluated at bid price : 12.60
Bid-YTW : 3.74 %
BAM.PR.K Floater -1.95 % YTW SCENARIO
Maturity Type : Limit Maturity
Maturity Date : 2047-03-16
Maturity Price : 12.60
Evaluated at bid price : 12.60
Bid-YTW : 3.74 %
TRP.PR.C FixedReset -1.94 % YTW SCENARIO
Maturity Type : Limit Maturity
Maturity Date : 2047-03-16
Maturity Price : 15.70
Evaluated at bid price : 15.70
Bid-YTW : 4.35 %
BAM.PR.C Floater -1.26 % YTW SCENARIO
Maturity Type : Limit Maturity
Maturity Date : 2047-03-16
Maturity Price : 12.52
Evaluated at bid price : 12.52
Bid-YTW : 3.77 %
PWF.PR.T FixedReset -1.24 % YTW SCENARIO
Maturity Type : Limit Maturity
Maturity Date : 2047-03-16
Maturity Price : 22.66
Evaluated at bid price : 23.01
Bid-YTW : 4.04 %
IFC.PR.A FixedReset -1.24 % YTW SCENARIO
Maturity Type : Hard Maturity
Maturity Date : 2025-01-31
Maturity Price : 25.00
Evaluated at bid price : 19.05
Bid-YTW : 7.10 %
SLF.PR.J FloatingReset 1.21 % YTW SCENARIO
Maturity Type : Hard Maturity
Maturity Date : 2025-01-31
Maturity Price : 25.00
Evaluated at bid price : 15.89
Bid-YTW : 8.28 %
MFC.PR.R FixedReset 1.41 % YTW SCENARIO
Maturity Type : Call
Maturity Date : 2022-03-19
Maturity Price : 25.00
Evaluated at bid price : 25.96
Bid-YTW : 4.01 %
Volume Highlights
Issue Index Shares
Traded
Notes
BMO.PR.C FixedReset 371,771 YTW SCENARIO
Maturity Type : Call
Maturity Date : 2022-05-25
Maturity Price : 25.00
Evaluated at bid price : 25.29
Bid-YTW : 4.29 %
BNS.PR.H FixedReset 197,496 YTW SCENARIO
Maturity Type : Call
Maturity Date : 2022-01-26
Maturity Price : 25.00
Evaluated at bid price : 26.25
Bid-YTW : 3.88 %
MFC.PR.R FixedReset 103,221 YTW SCENARIO
Maturity Type : Call
Maturity Date : 2022-03-19
Maturity Price : 25.00
Evaluated at bid price : 25.96
Bid-YTW : 4.01 %
RY.PR.Q FixedReset 90,309 YTW SCENARIO
Maturity Type : Call
Maturity Date : 2021-05-24
Maturity Price : 25.00
Evaluated at bid price : 27.10
Bid-YTW : 3.43 %
BAM.PR.X FixedReset 82,059 YTW SCENARIO
Maturity Type : Limit Maturity
Maturity Date : 2047-03-16
Maturity Price : 16.32
Evaluated at bid price : 16.32
Bid-YTW : 4.72 %
BIP.PR.D FixedReset 82,040 YTW SCENARIO
Maturity Type : Call
Maturity Date : 2022-03-31
Maturity Price : 25.00
Evaluated at bid price : 25.14
Bid-YTW : 4.85 %
There were 44 other index-included issues trading in excess of 10,000 shares.
Wide Spread Highlights
Issue Index Quote Data and Yield Notes
PWF.PR.O Perpetual-Premium Quote: 25.95 – 26.23
Spot Rate : 0.2800
Average : 0.1780

YTW SCENARIO
Maturity Type : Call
Maturity Date : 2017-04-15
Maturity Price : 25.50
Evaluated at bid price : 25.95
Bid-YTW : -7.40 %

HSE.PR.A FixedReset Quote: 16.22 – 16.50
Spot Rate : 0.2800
Average : 0.1952

YTW SCENARIO
Maturity Type : Limit Maturity
Maturity Date : 2047-03-16
Maturity Price : 16.22
Evaluated at bid price : 16.22
Bid-YTW : 4.44 %

PWF.PR.T FixedReset Quote: 23.01 – 23.25
Spot Rate : 0.2400
Average : 0.1706

YTW SCENARIO
Maturity Type : Limit Maturity
Maturity Date : 2047-03-16
Maturity Price : 22.66
Evaluated at bid price : 23.01
Bid-YTW : 4.04 %

TRP.PR.B FixedReset Quote: 14.51 – 14.78
Spot Rate : 0.2700
Average : 0.2030

YTW SCENARIO
Maturity Type : Limit Maturity
Maturity Date : 2047-03-16
Maturity Price : 14.51
Evaluated at bid price : 14.51
Bid-YTW : 4.29 %

IAG.PR.G FixedReset Quote: 23.30 – 23.50
Spot Rate : 0.2000
Average : 0.1351

YTW SCENARIO
Maturity Type : Hard Maturity
Maturity Date : 2025-01-31
Maturity Price : 25.00
Evaluated at bid price : 23.30
Bid-YTW : 5.18 %

IFC.PR.A FixedReset Quote: 19.05 – 19.30
Spot Rate : 0.2500
Average : 0.1867

YTW SCENARIO
Maturity Type : Hard Maturity
Maturity Date : 2025-01-31
Maturity Price : 25.00
Evaluated at bid price : 19.05
Bid-YTW : 7.10 %

March 15, 2017

March 15th, 2017

Today’s big news was the FOMC release:

In view of realized and expected labor market conditions and inflation, the Committee decided to raise the target range for the federal funds rate to 3/4 to 1 percent. The stance of monetary policy remains accommodative, thereby supporting some further strengthening in labor market conditions and a sustained return to 2 percent inflation.

In determining the timing and size of future adjustments to the target range for the federal funds rate, the Committee will assess realized and expected economic conditions relative to its objectives of maximum employment and 2 percent inflation.

However, Yellen was dovish after the meeting:

Speaking to reporters after the Fed’s quarter percentage-point move on Wednesday, Yellen said the central bank was willing to tolerate inflation temporarily overshooting its 2 percent goal and that it intended to keep its policy accommodative for “some time.”

“The simple message is the economy’s doing well. We have confidence in the robustness of the economy and its resilience to shocks,” she said.

As a result, the Fed is sticking with its policy of gradually raising interest rates, Yellen said. In their first forecasts in three months, Fed policy makers penciled in two more quarter-point rate increases this year and three in 2018, unchanged from their projections in December.

Today’s decision “does not represent a reassessment of the economic outlook or of the appropriate course for monetary policy,” the Fed chief said.

Asked about the potential for a fiscal boost, Yellen made clear the Fed is still waiting for more concrete policy plans to emerge from the Trump administration before adapting monetary policy in reaction.

“There is great uncertainty about the timing, the size and the character of policy changes that may be put in place,” Yellen said. “I don’t think that’s a decision or set of decisions that we need to make until we know more about what policy changes will go into effect.”

It’s clear that markets were expecting exciting hawkishness:

The yield on 10-year Treasury notes held at 2.49 percent after tumbling 11 basis points on Wednesday.

PerpetualDiscounts now yield 5.21%, equivalent to 6.77% interest at the standard conversion factor of 1.3x. Long corporates now yield about 4.15%, so the pre-tax interest-equivalent spread (in this context, the “Seniority Spread”) is now about 260bp, significantly narrower than the 270bp reported March 8.

HIMIPref™ Preferred Indices
These values reflect the December 2008 revision of the HIMIPref™ Indices

Values are provisional and are finalized monthly
Index Mean
Current
Yield
(at bid)
Median
YTW
Median
Average
Trading
Value
Median
Mod Dur
(YTW)
Issues Day’s Perf. Index Value
Ratchet 0.00 % 0.00 % 0 0.00 0 0.5272 % 2,148.8
FixedFloater 0.00 % 0.00 % 0 0.00 0 0.5272 % 3,943.0
Floater 3.54 % 3.67 % 47,993 18.16 4 0.5272 % 2,272.4
OpRet 0.00 % 0.00 % 0 0.00 0 0.1632 % 3,019.7
SplitShare 4.93 % 3.78 % 60,667 0.72 6 0.1632 % 3,606.2
Interest-Bearing 0.00 % 0.00 % 0 0.00 0 0.1632 % 2,813.7
Perpetual-Premium 5.35 % 2.96 % 68,151 0.09 20 0.1095 % 2,744.1
Perpetual-Discount 5.16 % 5.21 % 95,544 15.07 16 -0.0846 % 2,923.3
FixedReset 4.40 % 4.17 % 242,698 6.70 94 0.1171 % 2,349.7
Deemed-Retractible 5.04 % 1.42 % 139,247 0.20 31 0.1322 % 2,859.2
FloatingReset 2.48 % 3.25 % 50,862 4.60 9 0.0743 % 2,493.9
Performance Highlights
Issue Index Change Notes
BAM.PR.K Floater 1.18 % YTW SCENARIO
Maturity Type : Limit Maturity
Maturity Date : 2047-03-15
Maturity Price : 12.85
Evaluated at bid price : 12.85
Bid-YTW : 3.67 %
GWO.PR.N FixedReset 2.29 % YTW SCENARIO
Maturity Type : Hard Maturity
Maturity Date : 2025-01-31
Maturity Price : 25.00
Evaluated at bid price : 16.05
Bid-YTW : 8.74 %
Volume Highlights
Issue Index Shares
Traded
Notes
BNS.PR.B FloatingReset 104,189 YTW SCENARIO
Maturity Type : Hard Maturity
Maturity Date : 2022-01-31
Maturity Price : 25.00
Evaluated at bid price : 23.71
Bid-YTW : 3.31 %
POW.PR.D Perpetual-Discount 101,815 YTW SCENARIO
Maturity Type : Limit Maturity
Maturity Date : 2047-03-15
Maturity Price : 24.15
Evaluated at bid price : 24.40
Bid-YTW : 5.20 %
TD.PR.Z FloatingReset 101,614 YTW SCENARIO
Maturity Type : Hard Maturity
Maturity Date : 2022-01-31
Maturity Price : 25.00
Evaluated at bid price : 23.67
Bid-YTW : 3.32 %
PWF.PR.R Perpetual-Premium 100,500 YTW SCENARIO
Maturity Type : Call
Maturity Date : 2021-04-30
Maturity Price : 25.00
Evaluated at bid price : 25.55
Bid-YTW : 5.11 %
BMO.PR.T FixedReset 82,021 YTW SCENARIO
Maturity Type : Limit Maturity
Maturity Date : 2047-03-15
Maturity Price : 22.19
Evaluated at bid price : 22.52
Bid-YTW : 3.96 %
PWF.PR.L Perpetual-Discount 80,844 YTW SCENARIO
Maturity Type : Limit Maturity
Maturity Date : 2047-03-15
Maturity Price : 24.22
Evaluated at bid price : 24.51
Bid-YTW : 5.26 %
There were 51 other index-included issues trading in excess of 10,000 shares.
Wide Spread Highlights
Issue Index Quote Data and Yield Notes
BMO.PR.B FixedReset Quote: 26.18 – 26.60
Spot Rate : 0.4200
Average : 0.2554

YTW SCENARIO
Maturity Type : Call
Maturity Date : 2022-02-25
Maturity Price : 25.00
Evaluated at bid price : 26.18
Bid-YTW : 3.87 %

MFC.PR.R FixedReset Quote: 25.60 – 25.90
Spot Rate : 0.3000
Average : 0.1891

YTW SCENARIO
Maturity Type : Call
Maturity Date : 2022-03-19
Maturity Price : 25.00
Evaluated at bid price : 25.60
Bid-YTW : 4.32 %

TD.PR.Z FloatingReset Quote: 23.67 – 23.91
Spot Rate : 0.2400
Average : 0.1583

YTW SCENARIO
Maturity Type : Hard Maturity
Maturity Date : 2022-01-31
Maturity Price : 25.00
Evaluated at bid price : 23.67
Bid-YTW : 3.32 %

TRP.PR.D FixedReset Quote: 22.16 – 22.38
Spot Rate : 0.2200
Average : 0.1403

YTW SCENARIO
Maturity Type : Limit Maturity
Maturity Date : 2047-03-15
Maturity Price : 21.70
Evaluated at bid price : 22.16
Bid-YTW : 4.18 %

NA.PR.A FixedReset Quote: 26.45 – 26.62
Spot Rate : 0.1700
Average : 0.1136

YTW SCENARIO
Maturity Type : Call
Maturity Date : 2021-08-15
Maturity Price : 25.00
Evaluated at bid price : 26.45
Bid-YTW : 4.09 %

BAM.PF.G FixedReset Quote: 23.87 – 24.10
Spot Rate : 0.2300
Average : 0.1744

YTW SCENARIO
Maturity Type : Limit Maturity
Maturity Date : 2047-03-15
Maturity Price : 22.87
Evaluated at bid price : 23.87
Bid-YTW : 4.32 %

BSD.PR.A : DBRS Upgrades To Pfd-5(high)

March 14th, 2017

DBRS has announced that it:

has today upgraded the rating on the Preferred Securities issued by Brookfield Soundvest Split Trust (the Trust) to Pfd-5 (high) from Pfd-5.

In March 2005, the Trust raised gross proceeds of $180 million by issuing 7.2 million Preferred Securities (at $10 each) and an equal number of Capital Units (at $15 each). On March 27, 2015, unitholders of the Trust voted to extend the term of the fund by five years. The new maturity is March 31, 2020.

Based on the latest Portfolio’s yield, the Preferred Securities distribution coverage ratio is approximately 0.4 times. The insufficient amount of Portfolio dividends to cover Preferred Security distributions is projected to create an average annual grind on the Portfolio of approximately 3.3% in the next three years.

As at March 2, 2017, the downside protection available to the Preferred Securities was approximately 17.4%, which represents a gain of about 10% compared to the downside protection amount recorded a year ago. The downside protection has exhibited relative stability in the past four months, settling in the high-teens figures. Nevertheless, it remains subject to volatility, as it depends on the value of underlying securities of the Portfolio. The amount of downside protection and projected grind until the expected end of the term warrant an upgrade of the rating on the Preferred Securities issued by the Trust to Pfd-5 (high).

Assiduous Readers will remember that BSD.PR.A adopted some pretty dubious tactics while getting their term extension, has awful performance and suspended redemptions during the Credit Crunch without giving a reason.

EIT.PR.A Achieves Premium On Good Volume

March 14th, 2017

Canoe EIT Income Fund has announced:

that it has closed the previously announced offering of 4.80% Cumulative Redeemable Series 1 Preferred Units (the “Series 1 Preferred Units”). The Series 1 Preferred Units were offered to the public through a syndicate of underwriters led by Scotiabank and RBC Capital Markets which also included BMO Capital Markets, CIBC Capital Markets, National Bank Financial Inc., TD Securities Inc., Canaccord Genuity Corp., Industrial Alliance Securities Inc. and Manulife Securities Incorporated.

The Fund issued 4,900,000 Series 1 Preferred Units at a price of $25.00 per Series 1 Preferred Unit for gross proceeds of $122,500,000. The Fund has also granted the underwriters an option, exercisable at the offering price for a period of 30 days from today’s date, to purchase up to an additional 735,000 Series 1 Preferred Units to cover over-allotments, if any. Holders of the Series 1 Preferred Units will be entitled to fixed cumulative preferential cash distributions of $1.20 per Series 1 Preferred Unit per annum, as and when declared, which will accrue from the date of issue and will be payable quarterly on the 15th day of March, June, September and December in each year with the initial distribution, if declared, payable on June 15, 2017. The Series 1 Preferred Units are listed for trading on the Toronto Stock Exchange under the symbol EIT.PR.A.

The proceeds from the Offering will be invested by the Fund in accordance with its investment objectives and strategies. The Offering is expected to ensure the sustainability of the Fund by increasing the earning capacity of the units. The Series 1 Preferred Units are rated Pfd – 2 (high) by Dominion Bond Rating Service Limited.

The Fund’s regular monthly distribution of $0.10 per unit for unitholders of EIT.UN units remains unchanged. The Fund has maintained the $0.10 per unit monthly distribution since August 2009, through varying market conditions.

The Fund’s annual voluntary redemption feature for unitholders of EIT.UN units remains unchanged. Once a date has been set for the 2017 annual redemption, the Fund will issue a news release with the details.

EIT.PR.A is a 4.80% Seven Year Retractible that was announced 2017-3-8 after marketting began 2017-2-22. It will be tracked by HIMIPref™ and has been assigned to the Split Share subindex.

Note that according to the prospectus, to which I am not permitted to link because Canadian Securities Administrators take the view that you are all stupid, filthy, ignorant investor scum and do not deserve the slightest consideration whatsoever. You will have to go to SEDAR and look for “Canoe EIT Income Fund Mar 8 2017 14:21:01 ET Final short form prospectus – English PDF 266 K”.

Distributions in any given period may consist of net income, net capital gains and/or returns of capital.

The issue traded 213,320 shares today in a range of 24.90-25 before closing at 25.25-30, 5×10. Vital statistics are:

EIT.PR.A SplitShare YTW SCENARIO
Maturity Type : Soft Maturity
Maturity Date : 2024-03-14
Maturity Price : 25.00
Evaluated at bid price : 25.25
Bid-YTW : 4.66 %

EIT.PR.A is rated Pfd-2(high) by DBRS:

DBRS Limited (DBRS) has today finalized its provisional rating of Pfd-2 (high) on the Cumulative Redeemable Series 1 Preferred Units (the Series 1 Preferred Units) issued by Canoe EIT Income Fund (the Fund).

The Fund is a closed-end investment trust focused on a broad range of income-producing investments in various industries and geographic regions. The Fund can issue an unlimited number of capital units (the Units) and can also issue in-series Preferred Units up to a maximum aggregate amount equal to 25% of the Fund’s total assets after giving effect to the proposed offering of the Preferred Units. The Series 1 Preferred Units were issued at a price of $25.00 per Series 1 Preferred Unit. The Series 1 Preferred Units are retractable for cash at the option of the holder on or after March 15, 2024.

The Fund has a credit facility (the Credit Facility) with a Tier 1 Canadian bank, but is restricted by its Declaration of Trust from borrowing in excess of 20% of the Fund’s total assets at the time of borrowing, after giving effect to the borrowing. The Credit Facility is secured by all of the Fund’s present and after-acquired personal property, undertaking and assets as well as all proceeds thereof. Distributions on the Series 1 Preferred Units are restricted if a default or event of default occurs under the Credit Facility or if the outstanding amount borrowed exceeds the available credit at any time.

Net proceeds from the offering of the Series 1 Preferred Units, after deducting the fees and expenses incurred as a result of the offering, are expected to be invested by the Fund to grow its portfolio in accordance with its investment objectives and investment strategies.

The Series 1 Preferred Unit holders will be entitled to receive quarterly cumulative preferential cash distributions of $0.30 (or $1.20 annually), representing a 4.80% per annum return on the issue price of $25.00. The holders of the Units currently receive targeted monthly cash distributions amounting to $1.20 per annum. In addition, up to 10% of the aggregate outstanding Units may be redeemed at the option of the Unit holders each calendar year on a date determined by the Fund.

The risks relating to the Unit distributions and redemptions are partially mitigated by restrictions on distributions, purchases and redemptions in the Fund’s Declaration of Trust as the Fund cannot pay or declare payable any distribution amount to the Unitholders (other than amounts that are paid solely through the issuance of additional Units, which would not affect the downside protection, or annual redemption amounts at the option of the holders of Units as described above), purchase for cancellation or otherwise redeem the Units, unless and until the distribution entitlements of the Series 1 Preferred Units have been paid in full or moneys are set aside for such payment.

The Fund’s portfolio initially provides downside protection of approximately 84% to holders of the Series 1 Preferred Unit and an asset coverage of approximately 10.0 times (x). The Series 1 Preferred Unit distributions are expected to be mainly funded through income received from the income-generating securities in the Portfolio. The Fund may also engage in writing covered call options to supplement the income. The Series 1 Preferred Units dividend coverage is expected to be approximately 1.7x.

The Pfd-2 (high) rating assigned by DBRS is based on the level of downside protection available to holders of the Series 1 Preferred Units, the distribution coverage ratio and the diversification of the Fund’s portfolio. In addition, DBRS has taken into account the potential grind on the portfolio arising from (1) distributions to the Units and redemption rights, (2) potential foreign-exchange risk because some investments in foreign currencies are not hedged and (3) the fact that lenders under the Credit Facility have priority over the Fund’s assets up to the amount of credit outstanding. Considering the Credit Facility amount compared with the current total assets, DBRS does not view the latter risk to be significant.

Update, 2017-3-22: Canoe Financial has announced:

Canoe EIT Income Fund (the “Fund”) (TSX – EIT.UN, EIT.PR.A) announced today that the syndicate of underwriters for the offering (the “Offering”) of 4.80% Cumulative Redeemable Series 1 Preferred Units (the “Series 1 Preferred Units”) of the Fund has fully exercised its over-allotment option. As a result of the exercise of the over-allotment option, the Fund raised additional gross proceeds of $18,375,000 from the sale of 735,000 Series 1 Preferred Units. Inclusive of the over-allotment option, the Fund raised gross proceeds of $140,875,000 from the sale of 5,635,000 Series 1 Preferred Units. The Series 1 Preferred Units are listed on the Toronto Stock Exchange under the symbol EIT.PR.A.

March 14, 2017

March 14th, 2017
HIMIPref™ Preferred Indices
These values reflect the December 2008 revision of the HIMIPref™ Indices

Values are provisional and are finalized monthly
Index Mean
Current
Yield
(at bid)
Median
YTW
Median
Average
Trading
Value
Median
Mod Dur
(YTW)
Issues Day’s Perf. Index Value
Ratchet 0.00 % 0.00 % 0 0.00 0 0.0000 % 2,137.6
FixedFloater 0.00 % 0.00 % 0 0.00 0 0.0000 % 3,922.3
Floater 3.56 % 3.68 % 47,724 18.13 4 0.0000 % 2,260.5
OpRet 0.00 % 0.00 % 0 0.00 0 0.2190 % 3,014.8
SplitShare 4.94 % 3.77 % 63,163 0.73 6 0.2190 % 3,600.3
Interest-Bearing 0.00 % 0.00 % 0 0.00 0 0.2190 % 2,809.1
Perpetual-Premium 5.35 % 4.65 % 65,697 3.62 20 -0.0996 % 2,741.1
Perpetual-Discount 5.16 % 5.20 % 95,808 15.13 18 -0.1574 % 2,925.7
FixedReset 4.40 % 4.17 % 231,571 6.72 98 -0.0726 % 2,347.0
Deemed-Retractible 5.05 % 1.76 % 140,590 0.20 31 0.0093 % 2,855.5
FloatingReset 2.48 % 3.26 % 47,085 4.60 9 -0.1271 % 2,492.1
Performance Highlights
Issue Index Change Notes
HSE.PR.A FixedReset -2.36 % YTW SCENARIO
Maturity Type : Limit Maturity
Maturity Date : 2047-03-14
Maturity Price : 16.17
Evaluated at bid price : 16.17
Bid-YTW : 4.46 %
IFC.PR.A FixedReset -1.18 % YTW SCENARIO
Maturity Type : Hard Maturity
Maturity Date : 2025-01-31
Maturity Price : 25.00
Evaluated at bid price : 19.27
Bid-YTW : 6.92 %
SLF.PR.G FixedReset -1.17 % YTW SCENARIO
Maturity Type : Hard Maturity
Maturity Date : 2025-01-31
Maturity Price : 25.00
Evaluated at bid price : 16.85
Bid-YTW : 8.19 %
TRP.PR.E FixedReset -1.04 % YTW SCENARIO
Maturity Type : Limit Maturity
Maturity Date : 2047-03-14
Maturity Price : 22.36
Evaluated at bid price : 22.80
Bid-YTW : 4.08 %
Volume Highlights
Issue Index Shares
Traded
Notes
BMO.PR.C FixedReset 373,946 YTW SCENARIO
Maturity Type : Call
Maturity Date : 2022-05-25
Maturity Price : 25.00
Evaluated at bid price : 25.29
Bid-YTW : 4.28 %
EIT.PR.A SplitShare 213,320 YTW SCENARIO
Maturity Type : Soft Maturity
Maturity Date : 2024-03-14
Maturity Price : 25.00
Evaluated at bid price : 25.25
Bid-YTW : 4.66 %
TRP.PR.K FixedReset 135,871 YTW SCENARIO
Maturity Type : Call
Maturity Date : 2022-05-31
Maturity Price : 25.00
Evaluated at bid price : 25.76
Bid-YTW : 4.32 %
FTS.PR.J Perpetual-Discount 105,300 YTW SCENARIO
Maturity Type : Limit Maturity
Maturity Date : 2047-03-14
Maturity Price : 22.60
Evaluated at bid price : 22.95
Bid-YTW : 5.20 %
TD.PR.T FloatingReset 76,729 YTW SCENARIO
Maturity Type : Hard Maturity
Maturity Date : 2022-01-31
Maturity Price : 25.00
Evaluated at bid price : 23.87
Bid-YTW : 3.05 %
NA.PR.A FixedReset 69,578 YTW SCENARIO
Maturity Type : Call
Maturity Date : 2021-08-15
Maturity Price : 25.00
Evaluated at bid price : 26.45
Bid-YTW : 4.09 %
There were 35 other index-included issues trading in excess of 10,000 shares.
Wide Spread Highlights
Issue Index Quote Data and Yield Notes
BAM.PR.K Floater Quote: 12.70 – 13.40
Spot Rate : 0.7000
Average : 0.4119

YTW SCENARIO
Maturity Type : Limit Maturity
Maturity Date : 2047-03-14
Maturity Price : 12.70
Evaluated at bid price : 12.70
Bid-YTW : 3.71 %

BNS.PR.H FixedReset Quote: 26.08 – 26.38
Spot Rate : 0.3000
Average : 0.1939

YTW SCENARIO
Maturity Type : Call
Maturity Date : 2022-01-26
Maturity Price : 25.00
Evaluated at bid price : 26.08
Bid-YTW : 4.03 %

CM.PR.O FixedReset Quote: 22.63 – 22.90
Spot Rate : 0.2700
Average : 0.1702

YTW SCENARIO
Maturity Type : Limit Maturity
Maturity Date : 2047-03-14
Maturity Price : 22.27
Evaluated at bid price : 22.63
Bid-YTW : 4.03 %

GWO.PR.N FixedReset Quote: 15.69 – 16.06
Spot Rate : 0.3700
Average : 0.2705

YTW SCENARIO
Maturity Type : Hard Maturity
Maturity Date : 2025-01-31
Maturity Price : 25.00
Evaluated at bid price : 15.69
Bid-YTW : 9.08 %

TRP.PR.A FixedReset Quote: 19.20 – 19.57
Spot Rate : 0.3700
Average : 0.2853

YTW SCENARIO
Maturity Type : Limit Maturity
Maturity Date : 2047-03-14
Maturity Price : 19.20
Evaluated at bid price : 19.20
Bid-YTW : 4.18 %

GWO.PR.M Deemed-Retractible Quote: 25.90 – 26.10
Spot Rate : 0.2000
Average : 0.1251

YTW SCENARIO
Maturity Type : Call
Maturity Date : 2017-04-30
Maturity Price : 25.50
Evaluated at bid price : 25.90
Bid-YTW : -8.41 %

Toronto Rock Lacrosse Tickets: Update #4

March 13th, 2017

I have no more pairs of Toronto Rock Lacrosse tickets to give away!

The fifth lucky winner, who got the tickets for March 25 against the Vancouver Stealth, was Jeremy Tabarrok.

Giveaways this year were:

Toronto Rock Lacrosse Ticket Giveaway
Date Opponent
Saturday
2017-1-28
7pm
Rochester Knighthawks
Friday
2017-2-3
7:30pm
Buffalo Bandits
Friday
2017-3-3
7:30pm
New England Black Wolves
Saturday
2017-3-11
7:00pm
Calgary Roughnecks
Saturday
2017-3-25
7:00pm
Vancouver Stealth

The games are a lot of fun. One thing that has impressed me is that these guys’ technical skills are so good they can concentrate on strategy … there are a lot fewer loose balls than I remember from my days of box lacrosse at age 10!

There will be more tickets next year!

March 13, 2017

March 13th, 2017
HIMIPref™ Preferred Indices
These values reflect the December 2008 revision of the HIMIPref™ Indices

Values are provisional and are finalized monthly
Index Mean
Current
Yield
(at bid)
Median
YTW
Median
Average
Trading
Value
Median
Mod Dur
(YTW)
Issues Day’s Perf. Index Value
Ratchet 0.00 % 0.00 % 0 0.00 0 1.5444 % 2,137.6
FixedFloater 0.00 % 0.00 % 0 0.00 0 1.5444 % 3,922.3
Floater 3.56 % 3.69 % 46,591 18.11 4 1.5444 % 2,260.5
OpRet 0.00 % 0.00 % 0 0.00 0 0.1567 % 3,008.2
SplitShare 4.98 % 3.75 % 63,114 0.73 5 0.1567 % 3,592.5
Interest-Bearing 0.00 % 0.00 % 0 0.00 0 0.1567 % 2,803.0
Perpetual-Premium 5.35 % 4.59 % 64,318 2.81 20 0.0098 % 2,743.8
Perpetual-Discount 5.15 % 5.20 % 96,680 15.11 18 0.1814 % 2,930.4
FixedReset 4.40 % 4.15 % 229,286 6.73 98 0.4524 % 2,348.7
Deemed-Retractible 5.05 % 0.39 % 139,870 0.20 31 0.0530 % 2,855.2
FloatingReset 2.48 % 3.24 % 46,184 4.60 9 -0.0053 % 2,495.2
Performance Highlights
Issue Index Change Notes
BAM.PF.G FixedReset 1.00 % YTW SCENARIO
Maturity Type : Limit Maturity
Maturity Date : 2047-03-13
Maturity Price : 22.92
Evaluated at bid price : 23.98
Bid-YTW : 4.29 %
SLF.PR.H FixedReset 1.01 % YTW SCENARIO
Maturity Type : Hard Maturity
Maturity Date : 2025-01-31
Maturity Price : 25.00
Evaluated at bid price : 20.00
Bid-YTW : 6.33 %
TD.PF.D FixedReset 1.03 % YTW SCENARIO
Maturity Type : Limit Maturity
Maturity Date : 2047-03-13
Maturity Price : 22.74
Evaluated at bid price : 23.63
Bid-YTW : 4.20 %
CM.PR.P FixedReset 1.05 % YTW SCENARIO
Maturity Type : Limit Maturity
Maturity Date : 2047-03-13
Maturity Price : 21.87
Evaluated at bid price : 22.15
Bid-YTW : 4.03 %
BAM.PF.B FixedReset 1.07 % YTW SCENARIO
Maturity Type : Limit Maturity
Maturity Date : 2047-03-13
Maturity Price : 21.42
Evaluated at bid price : 21.75
Bid-YTW : 4.51 %
RY.PR.J FixedReset 1.08 % YTW SCENARIO
Maturity Type : Limit Maturity
Maturity Date : 2047-03-13
Maturity Price : 22.70
Evaluated at bid price : 23.50
Bid-YTW : 4.17 %
MFC.PR.I FixedReset 1.13 % YTW SCENARIO
Maturity Type : Hard Maturity
Maturity Date : 2025-01-31
Maturity Price : 25.00
Evaluated at bid price : 23.27
Bid-YTW : 5.24 %
MFC.PR.L FixedReset 1.14 % YTW SCENARIO
Maturity Type : Hard Maturity
Maturity Date : 2025-01-31
Maturity Price : 25.00
Evaluated at bid price : 21.35
Bid-YTW : 5.94 %
BAM.PF.F FixedReset 1.14 % YTW SCENARIO
Maturity Type : Limit Maturity
Maturity Date : 2047-03-13
Maturity Price : 22.92
Evaluated at bid price : 23.74
Bid-YTW : 4.35 %
MFC.PR.N FixedReset 1.14 % YTW SCENARIO
Maturity Type : Hard Maturity
Maturity Date : 2025-01-31
Maturity Price : 25.00
Evaluated at bid price : 22.11
Bid-YTW : 5.51 %
MFC.PR.M FixedReset 1.15 % YTW SCENARIO
Maturity Type : Hard Maturity
Maturity Date : 2025-01-31
Maturity Price : 25.00
Evaluated at bid price : 22.06
Bid-YTW : 5.61 %
FTS.PR.G FixedReset 1.17 % YTW SCENARIO
Maturity Type : Limit Maturity
Maturity Date : 2047-03-13
Maturity Price : 20.83
Evaluated at bid price : 20.83
Bid-YTW : 4.15 %
BAM.PF.H FixedReset 1.17 % YTW SCENARIO
Maturity Type : Call
Maturity Date : 2020-12-31
Maturity Price : 25.00
Evaluated at bid price : 26.75
Bid-YTW : 2.98 %
BAM.PF.A FixedReset 1.17 % YTW SCENARIO
Maturity Type : Limit Maturity
Maturity Date : 2047-03-13
Maturity Price : 22.78
Evaluated at bid price : 23.19
Bid-YTW : 4.51 %
BAM.PF.D Perpetual-Discount 1.18 % YTW SCENARIO
Maturity Type : Limit Maturity
Maturity Date : 2047-03-13
Maturity Price : 23.07
Evaluated at bid price : 23.45
Bid-YTW : 5.22 %
BMO.PR.S FixedReset 1.20 % YTW SCENARIO
Maturity Type : Limit Maturity
Maturity Date : 2047-03-13
Maturity Price : 22.35
Evaluated at bid price : 22.70
Bid-YTW : 4.02 %
CM.PR.O FixedReset 1.21 % YTW SCENARIO
Maturity Type : Limit Maturity
Maturity Date : 2047-03-13
Maturity Price : 22.29
Evaluated at bid price : 22.66
Bid-YTW : 4.03 %
FTS.PR.M FixedReset 1.21 % YTW SCENARIO
Maturity Type : Limit Maturity
Maturity Date : 2047-03-13
Maturity Price : 22.69
Evaluated at bid price : 23.36
Bid-YTW : 4.04 %
MFC.PR.K FixedReset 1.27 % YTW SCENARIO
Maturity Type : Hard Maturity
Maturity Date : 2025-01-31
Maturity Price : 25.00
Evaluated at bid price : 21.48
Bid-YTW : 5.82 %
BMO.PR.W FixedReset 1.28 % YTW SCENARIO
Maturity Type : Limit Maturity
Maturity Date : 2047-03-13
Maturity Price : 21.93
Evaluated at bid price : 22.20
Bid-YTW : 3.99 %
BIP.PR.B FixedReset 1.37 % YTW SCENARIO
Maturity Type : Call
Maturity Date : 2020-12-31
Maturity Price : 25.00
Evaluated at bid price : 25.86
Bid-YTW : 4.45 %
BAM.PR.K Floater 1.44 % YTW SCENARIO
Maturity Type : Limit Maturity
Maturity Date : 2047-03-13
Maturity Price : 12.65
Evaluated at bid price : 12.65
Bid-YTW : 3.73 %
PWF.PR.T FixedReset 1.46 % YTW SCENARIO
Maturity Type : Limit Maturity
Maturity Date : 2047-03-13
Maturity Price : 22.64
Evaluated at bid price : 22.99
Bid-YTW : 4.04 %
BMO.PR.T FixedReset 1.49 % YTW SCENARIO
Maturity Type : Limit Maturity
Maturity Date : 2047-03-13
Maturity Price : 22.12
Evaluated at bid price : 22.43
Bid-YTW : 3.97 %
FTS.PR.H FixedReset 1.50 % YTW SCENARIO
Maturity Type : Limit Maturity
Maturity Date : 2047-03-13
Maturity Price : 16.25
Evaluated at bid price : 16.25
Bid-YTW : 4.16 %
MFC.PR.F FixedReset 1.55 % YTW SCENARIO
Maturity Type : Hard Maturity
Maturity Date : 2025-01-31
Maturity Price : 25.00
Evaluated at bid price : 15.75
Bid-YTW : 9.06 %
RY.PR.M FixedReset 1.57 % YTW SCENARIO
Maturity Type : Limit Maturity
Maturity Date : 2047-03-13
Maturity Price : 22.57
Evaluated at bid price : 23.36
Bid-YTW : 4.08 %
BAM.PR.X FixedReset 1.58 % YTW SCENARIO
Maturity Type : Limit Maturity
Maturity Date : 2047-03-13
Maturity Price : 16.30
Evaluated at bid price : 16.30
Bid-YTW : 4.73 %
FTS.PR.K FixedReset 1.76 % YTW SCENARIO
Maturity Type : Limit Maturity
Maturity Date : 2047-03-13
Maturity Price : 20.76
Evaluated at bid price : 20.76
Bid-YTW : 4.11 %
BAM.PR.C Floater 1.84 % YTW SCENARIO
Maturity Type : Limit Maturity
Maturity Date : 2047-03-13
Maturity Price : 12.69
Evaluated at bid price : 12.69
Bid-YTW : 3.72 %
BAM.PR.B Floater 2.39 % YTW SCENARIO
Maturity Type : Limit Maturity
Maturity Date : 2047-03-13
Maturity Price : 12.77
Evaluated at bid price : 12.77
Bid-YTW : 3.69 %
Volume Highlights
Issue Index Shares
Traded
Notes
BMO.PR.C FixedReset 74,168 YTW SCENARIO
Maturity Type : Call
Maturity Date : 2022-05-25
Maturity Price : 25.00
Evaluated at bid price : 25.29
Bid-YTW : 4.28 %
HSE.PR.G FixedReset 65,726 YTW SCENARIO
Maturity Type : Limit Maturity
Maturity Date : 2047-03-13
Maturity Price : 23.09
Evaluated at bid price : 24.35
Bid-YTW : 4.82 %
FTS.PR.G FixedReset 65,034 YTW SCENARIO
Maturity Type : Limit Maturity
Maturity Date : 2047-03-13
Maturity Price : 20.83
Evaluated at bid price : 20.83
Bid-YTW : 4.15 %
BAM.PF.D Perpetual-Discount 41,700 YTW SCENARIO
Maturity Type : Limit Maturity
Maturity Date : 2047-03-13
Maturity Price : 23.07
Evaluated at bid price : 23.45
Bid-YTW : 5.22 %
RY.PR.Z FixedReset 41,293 YTW SCENARIO
Maturity Type : Limit Maturity
Maturity Date : 2047-03-13
Maturity Price : 22.25
Evaluated at bid price : 22.56
Bid-YTW : 3.93 %
BAM.PF.G FixedReset 35,721 YTW SCENARIO
Maturity Type : Limit Maturity
Maturity Date : 2047-03-13
Maturity Price : 22.92
Evaluated at bid price : 23.98
Bid-YTW : 4.29 %
There were 44 other index-included issues trading in excess of 10,000 shares.
Wide Spread Highlights
Issue Index Quote Data and Yield Notes
PWF.PR.P FixedReset Quote: 15.80 – 16.15
Spot Rate : 0.3500
Average : 0.2183

YTW SCENARIO
Maturity Type : Limit Maturity
Maturity Date : 2047-03-13
Maturity Price : 15.80
Evaluated at bid price : 15.80
Bid-YTW : 4.41 %

FTS.PR.F Perpetual-Discount Quote: 23.60 – 23.87
Spot Rate : 0.2700
Average : 0.1851

YTW SCENARIO
Maturity Type : Limit Maturity
Maturity Date : 2047-03-13
Maturity Price : 23.32
Evaluated at bid price : 23.60
Bid-YTW : 5.22 %

BMO.PR.B FixedReset Quote: 26.06 – 26.24
Spot Rate : 0.1800
Average : 0.1023

YTW SCENARIO
Maturity Type : Call
Maturity Date : 2022-02-25
Maturity Price : 25.00
Evaluated at bid price : 26.06
Bid-YTW : 3.97 %

MFC.PR.B Deemed-Retractible Quote: 23.10 – 23.32
Spot Rate : 0.2200
Average : 0.1424

YTW SCENARIO
Maturity Type : Hard Maturity
Maturity Date : 2025-01-31
Maturity Price : 25.00
Evaluated at bid price : 23.10
Bid-YTW : 5.89 %

IAG.PR.A Deemed-Retractible Quote: 22.70 – 23.00
Spot Rate : 0.3000
Average : 0.2256

YTW SCENARIO
Maturity Type : Hard Maturity
Maturity Date : 2025-01-31
Maturity Price : 25.00
Evaluated at bid price : 22.70
Bid-YTW : 6.08 %

BAM.PR.B Floater Quote: 12.77 – 13.00
Spot Rate : 0.2300
Average : 0.1677

YTW SCENARIO
Maturity Type : Limit Maturity
Maturity Date : 2047-03-13
Maturity Price : 12.77
Evaluated at bid price : 12.77
Bid-YTW : 3.69 %

SLF : S&P Improves Outlook to Positive

March 13th, 2017

Standard & Poor’s has announced:

  • •We are revising our outlook on Sun Life Financial to positive, reflecting our belief that the company will maintain AAA capital adequacy post-LICAT rollout, which would lead to an upgrade within the next 24 months.
  • •We also expect the company to maintain modestly growing net income over the next two years.
  • •At the same time, we affirmed our ‘AA-‘ratings on SLF and its core subsidiaries.


“Over the last five years, the company has successfully executed its four-pillar strategy, focusing on its Canadian, Asian, Investment Management and US group benefits businesses.” said S&P Global Ratings credit analyst Peggy Poon. Given the significantly de-risked business risk profile following the successful sale of the U.S. individual annuity business in 2013 and our forecast for Canada’s macroeconomic environment, we believe the company will maintain ‘AAA’ capital adequacy as measured by our model prospectively in addition to modestly growing its net income over the next few years.

Affected issues are SLF.PR.A, SLF.PR.B, SLF.PR.C, SLF.PR.D, SLF.PR.E, SLF.PR.G, SLF.PR.H, SLF.PR.I, SLF.PR.J and SLF.PR.K.

The FixedResets of the company exhibit an Implied Volatility of 18% … which is higher than the high-single-digits I would consider normal for an investment-grade company, but lower than I would expect if the market fully subscribed to my theory that these issues will eventually be subject to a Deemed Retraction.

impvol_slf_170313
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