Category: Issue Comments

Brookfield Asset Management Inc. has announced:

that it has determined the fixed dividend rate on its Cumulative Class A Preference Shares, Series 38 (“Series 38 Shares”) (TSX: BAM.PF.E) for the five years commencing April 1, 2020 and ending March 31, 2025, and also determined the quarterly dividend on its floating rate Cumulative Class A Preference Shares, Series 25 (“Series 25 Shares”) (TSX: BAM.PR.S).

Series 38 Shares and Series 39 Shares

If declared, the fixed quarterly dividends on the Series 38 Shares during the five years commencing April 1, 2020 will be $0.223 per share per quarter, which represents a yield of 5.685% on the most recent trading price, similar to the current yield. The new fixed dividend rate that will apply for the five years commencing April 1, 2020 represents a yield of 3.568% based on the redemption price of $25 per share.

Holders of Series 38 Shares have the right, at their option, exercisable not later than 5:00 p.m. (Toronto time) on March 16, 2020, to convert all or part of their Series 38 Shares, on a one-for-one basis, into Cumulative Class A Preference Shares, Series 39 (the “Series 39 Shares”), effective March 31, 2020.

The quarterly floating rate dividends on the Series 39 Shares will be paid at an annual rate, calculated for each quarter, of 2.55% over the annual yield on three-month Government of Canada treasury bills. The actual quarterly dividend rate in respect of the April 1, 2020 to June 30, 2020 dividend period for the Series 39 Shares will be 1.04413% (4.188% on an annualized basis) and the dividend, if declared, for such dividend period will be $0.2610325 per share, payable on June 30, 2020.

Holders of Series 38 Shares are not required to elect to convert all or any part of their Series 38 Shares into Series 39 Shares.

As provided in the share conditions of the Series 38 Shares, (i) if Brookfield determines that there would be fewer than 1,000,000 Series 38 Shares outstanding after March 31, 2020, all remaining Series 38 Shares will be automatically converted into Series 39 Shares on a one-for-one basis effective March 31, 2020; and (ii) if Brookfield determines that there would be fewer than 1,000,000 Series 39 Shares outstanding after March 31, 2020, no Series 38 Shares will be permitted to be converted into Series 39 Shares. There are currently 7,906,132 Series 38 Shares outstanding.

The Toronto Stock Exchange (“TSX”) has conditionally approved the listing of the Series 39 Shares effective upon conversion. Listing of the Series 39 Shares is subject to Brookfield fulfilling all the listing requirements of the TSX and, upon approval, the Series 39 Shares will be listed on the TSX under the trading symbol “BAM.PF.K”.

BAM.PF.E is a FixedReset, 4.40%+255, that commenced trading 2014-3-13 after being announced 2014-3-6. It is tracked by HIMIPref™ and is assigned to the FixedReset (Discount) subindex.

The most logical way to analyze the question of whether or not to convert is through the theory of Preferred Pairs, for which a calculator is available. Briefly, a Strong Pair is defined as a pair of securities that can be interconverted in the future (e.g., BAM.PF.E and the FloatingReset that will exist if enough holders convert). Since they will be interconvertible on this future date, it may be assumed that they will be priced identically on this date (if they aren’t then holders will simply convert en masse to the higher-priced issue). And since they will be priced identically on a given date in the future, any current difference in price must be offset by expectations of an equal and opposite value of dividends to be received in the interim. And since the dividend rate on one element of the pair is both fixed and known, the implied average rate of the other, floating rate, instrument can be determined. Finally, we say, we may compare these average rates and take a view regarding the actual future course of that rate relative to the implied rate, which will provide us with guidance on which element of the pair is likely to outperform the other until the next interconversion date, at which time the process will be repeated.

We can show the break-even rates for each FixedReset / FloatingReset Strong Pair graphically by plotting the implied average 3-month bill rate against the next Exchange Date (which is the date to which the average will be calculated). Inspection of the graph and the overall average break-even rates for extant pairs will provide a guide for estimating the break-even rate for the pair now under consideration assuming, of course, that enough conversions occur so that the pair is in fact created.

Click for Big

The market shows odd differences in its enthusiasm for floating rate product; the implied rates until the next interconversion are generally well below the current 3-month bill rate as the averages for investment-grade and junk issues are at +0.70% and +1.78% (ignoring the outliers AIM.PR.A / AIM.PR.B, and FFH.PR.E / FFH.PR.F, both of which Exchange 2020-3-31; as well as FFH.PR.G / FFH.PR.H), respectively. Whatever might be the result of the next few Bank of Canada overnight rate decisions, I suggest that it is unlikely that the average rate over the next five years will be lower than current – but if you disagree, of course, you may interpret the data any way you like.

The breakeven rate for the junk pairs has been relatively high recently; I confess I’m not quite sure what to make of it.

Since credit quality of each element of the pair is equal to the other element, it should not make any difference whether the pair examined is investment-grade or junk, although we might expect greater variation of implied rates between junk issues on grounds of lower liquidity, and this is just what we see.

If we plug in the current bid price of the BAM.PF.E FixedReset, we may construct the following table showing consistent prices for its soon-may-be-issued FloatingReset counterpart given a variety of Implied Breakeven yields consistent with issues currently trading:

Based on current market conditions, I suggest that the FloatingResets that will result from conversion are likely to trade at about the same price as their FixedReset counterparts, BAM.PF.E. Therefore, it seems likely that I will recommend that holders of BAM.PF.E make their own decision based on their own portfolios and financial circumstances, but I will wait until it’s closer to the March 16 notification deadline before making a final pronouncement. I will note that once the conversion period has passed it may be a good trade to swap one issue for the other in the market once both elements of each pair are trading and you can – hopefully – do it with a reasonably good take-out in price, rather than doing it through the company on a 1:1 basis. But that, of course, will depend on the prices at that time and your forecast for the path of policy rates over the next five years. There are no guarantees – my recommendation is based on the assumption that current market conditions with respect to the pairs will continue until the FloatingResets commence trading and that the relative pricing of the two new pairs will reflect these conditions.

Brompton Group has announced:

Brompton Oil Split Corp. (the “Fund”) announces a pro-rata redemption of class A shares will be required (the “Class A Shares”) to maintain an equal number of preferred shares (the “Preferred Shares”) and Class A Shares outstanding. In connection with the extension of the Fund’s term for an additional three years, holders of both Class A Shares and Preferred Shares had a special retraction right. Preferred shareholders retracted 2,416,132 more shares than Class A shareholders. As a result, unless Preferred Shares are withdrawn from the retraction, the Fund will be required to redeem 2,416,132 Class A Shares on a pro-rata basis pursuant to the Fund’s constating documents which is a reduction of approximately 75.269% of each Class A shareholders’ holdings. Each Class A shareholder of record on March 31, 2020 will receive a redemption price equal to the greater of: (i) the net asset value per unit (each unit consisting of 1 Class A Share and 1 Preferred Share) minus the sum of $10.00 plus any accrued and unpaid distributions on a Preferred Share, and (ii) nil. The redemption payment will be made on or before April 15, 2020.

The Fund invests in a portfolio of equity securities of large capitalization North American oil and gas issuers, primarily focused on those with significant exposure to oil.

Extension details were announced in January following the March, 2019, notice of extension. In the former post, I strongly recommended retraction of the preferreds. As of 2020-2-28, the fund had only $8.38 in assets for every $10.00 of preferred share obligations.

Manulife Financial Corporation has announced (on February 19):

the applicable dividend rates for its Non-cumulative Rate Reset Class 1 Shares Series 19 (the “Series 19 Preferred Shares”) (TSX: MFC.PR.N) and Non-cumulative Floating Rate Class 1 Shares Series 20 (the “Series 20 Preferred Shares”).

With respect to any Series 19 Preferred Shares that remain outstanding after March 19, 2020, holders thereof will be entitled to receive fixed rate non-cumulative preferential cash dividends on a quarterly basis, as and when declared by the Board of Directors of Manulife and subject to the provisions of the Insurance Companies Act (Canada). The dividend rate for the five-year period commencing on March 20, 2020, and ending on March 19, 2025, will be 3.6750% per annum or $0.229688 per share per quarter, being equal to the sum of the five-year Government of Canada bond yield as at February 19, 2020, plus 2.30%, as determined in accordance with the terms of the Series 19 Preferred Shares.

With respect to any Series 20 Preferred Shares that may be issued on March 19, 2020 in connection with the conversion of the Series 19 Preferred Shares into the Series 20 Preferred Shares, holders thereof will be entitled to receive floating rate non-cumulative preferential cash dividends on a quarterly basis, calculated on the basis of actual number of days elapsed in each quarterly floating rate period divided by 365, as and when declared by the Board of Directors of Manulife and subject to the provisions of the Insurance Companies Act (Canada). The dividend rate for the three-month period commencing on March 20, 2020, and ending on June 19, 2020, will be 0.99259% (3.9380% on an annualized basis) or $0.248148 per share, being equal to the sum of the three-month Government of Canada Treasury bill yield as at February 19, 2020, plus 2.30%, as determined in accordance with the terms of the Series 20 Preferred Shares.

Beneficial owners of Series 19 Preferred Shares who wish to exercise their right of conversion should instruct their broker or other nominee to exercise such right before 5:00 p.m. (Toronto time) on March 4, 2020. The news release announcing such conversion right was issued on February 3, 2020 and can be viewed on SEDAR or Manulife’s website. Conversion inquiries should be directed to Manulife’s Registrar and Transfer Agent, AST Trust Company (Canada), at 1‑800‑783‑9495.

The Toronto Stock Exchange (“TSX”) has conditionally approved the listing of the Series 20 Preferred Shares effective upon conversion. Listing of the Series 20 Preferred Shares is subject to Manulife fulfilling all the listing requirements of the TSX and, upon approval, the Series 20 Preferred Shares will be listed on the TSX under the trading symbol “MFC.PR.S”.

MFC.PR.N is a FixedReset, 3.80%+230, that commenced trading 2014-12-3 after being announced 2014-11-26. The company provided notice of extension 2020-2-3. It is tracked by HIMIPref™ and is assigned to the FixedReset – Insurance non-NVCC subindex.

The most logical way to analyze the question of whether or not to convert is through the theory of Preferred Pairs, for which a calculator is available. Briefly, a Strong Pair is defined as a pair of securities that can be interconverted in the future (e.g., MFC.PR.N and the FloatingReset that will exist if enough holders convert). Since they will be interconvertible on this future date, it may be assumed that they will be priced identically on this date (if they aren’t then holders will simply convert en masse to the higher-priced issue). And since they will be priced identically on a given date in the future, any current difference in price must be offset by expectations of an equal and opposite value of dividends to be received in the interim. And since the dividend rate on one element of the pair is both fixed and known, the implied average rate of the other, floating rate, instrument can be determined. Finally, we say, we may compare these average rates and take a view regarding the actual future course of that rate relative to the implied rate, which will provide us with guidance on which element of the pair is likely to outperform the other until the next interconversion date, at which time the process will be repeated.

We can show the break-even rates for each FixedReset / FloatingReset Strong Pair graphically by plotting the implied average 3-month bill rate against the next Exchange Date (which is the date to which the average will be calculated). Inspection of the graph and the overall average break-even rates for extant pairs will provide a guide for estimating the break-even rate for the pair now under consideration assuming, of course, that enough conversions occur so that the pair is in fact created.

Click for Big

The market has little enthusiasm for floating rate product; the implied rates until the next interconversion are generally well below the current 3-month bill rate as the averages for investment-grade and junk issues are at +0.84% and +1.71% (ignoring the outlier AIM.PR.A / AIM.PR.B, which Exchanges 2020-3-31), respectively. Whatever might be the result of the next few Bank of Canada overnight rate decisions, I suggest that it is unlikely that the average rate over the next five years will be lower than current – but if you disagree, of course, you may interpret the data any way you like.

The breakeven rate for the junk pairs has been relatively high recently; I confess I’m not quite sure what to make of it.

Since credit quality of each element of the pair is equal to the other element, it should not make any difference whether the pair examined is investment-grade or junk, although we might expect greater variation of implied rates between junk issues on grounds of lower liquidity, and this is just what we see.

If we plug in the current bid price of the MFC.PR.N FixedReset, we may construct the following table showing consistent prices for its soon-may-be-issued FloatingReset counterpart given a variety of Implied Breakeven yields consistent with issues currently trading:

Based on current market conditions, I suggest that the FloatingResets that will result from conversion are likely to trade below the price of their FixedReset counterparts, MFC.PR.N. Therefore, it seems likely that I will recommend that holders of MFC.PR.N continue to hold the issue and not to convert, but I will wait until it’s closer to the March 4 notification deadline before making a final pronouncement. I will note that once the conversion period has passed it may be a good trade to swap one issue for the other in the market once both elements of each pair are trading and you can – hopefully – do it with a reasonably good take-out in price, rather than doing it through the company on a 1:1 basis. But that, of course, will depend on the prices at that time and your forecast for the path of policy rates over the next five years. There are no guarantees – my recommendation is based on the assumption that current market conditions with respect to the pairs will continue until the FloatingResets commence trading and that the relative pricing of the two new pairs will reflect these conditions.

Enbridge Inc. has announced (on February 18):

that none of its outstanding Cumulative Redeemable Preference Shares, Series 11 (Series 11 Shares) will be converted into Cumulative Redeemable Preference Shares, Series 12 of Enbridge (Series 12 Shares) on March 1, 2020.

After taking into account all conversion notices received from holders of its outstanding Series 11 Shares by the February 18, 2020 deadline for the conversion of the Series 11 Shares into Series 12 Shares, less than the 1,000,000 Series 11 Shares required to give effect to conversions into Series 12 Shares were tendered for conversion.

ENB.PF.C is a FixedReset, 4.40%+264, that commenced trading 2014-5-22 after being announced 2014-5-12. ENB.PF.C will reset at 3.938% effective March 1, 2020. I recommended against conversion. The issue is tracked by HIMIPref™ but is relegated to the Scraps – FixedReset – Discount subindex on credit concerns.

Standard & Poor’s has announced:

• On Feb. 6, 2020, Innergex Renewable Energy Inc. (Innergex) and Hydro-Quebec announced the formation of a strategic partnership whereby Hydro-Quebec has invested C$661 million in Innergex’s equity through a private placement, and committed to C$500 million in further capital for future co-investments in renewable energy projects globally.
• We view Hydro-Quebec’s equity investment in Innergex as supportive for the rating. Therefore, we are removing the issuer credit rating (ICR) and preferred share rating from CreditWatch, where they were placed with negative implications on Dec. 23, 2019. At the same time, we are affirming our ‘BBB-‘ ICR on the company and our ‘BB’ global scale and ‘P-3’ Canada scale preferred stock ratings on the company.
• The negative outlook reflects limited headroom to withstand financial underperformance, increased debt levels, or any other credit-negative events. We believe there is a one-in-three likelihood that leverage could be higher than our base-case forecast.
• We continue to assess the business risk profile as satisfactory, underpinned by high levels of contractedness and counterparty strength, reasonable asset performance, and good diversity.

…
While we acknowledge that the equity issuance helps improve Innergex’s credit metrics to an extent that it supports the rating, we believe there is a likelihood that leverage could be higher than our base-case forecast and possibly below the downside trigger given limited headroom, rapid development track record, and aggressive use of corporate debt to fund equity in projects. Our forecast assumptions also incorporate asset-level financing for some of the company’s projects that are currently under construction. This ultimately has a positive impact on holdco debt and our calculated metrics, which could be adversely affected if the financings are delayed or amounts differ from plan. Finally, Hydro-Quebec is committed to co-invest C$500 million with Innergex in suitable renewable projects over the next three years. Details on the deployment of this capital (timing, development versus acquisition, financing, incremental cash flow, etc.) are unknown, but in our view, the risk remains that leverage could be higher than our base-case forecast if Innergex relies heavily on corporate debt to co-fund equity in these investments.

The negative outlook reflects FFO-to-debt of about 23% in 2020, which is at the cusp of the downside trigger. We believe that Innergex will continue with its strategy of funding the equity portion of its development pipeline with corporate debt and will have limited free cash flow to reduce holdco debt given its ambitious growth plans. Therefore, we believe that there is a one-in-three likelihood that leverage could be higher than our base-case forecast.

We could lower the rating if we expect that Innergex will be unable to achieve FFO-to-debt of at least 23% in 2020 and beyond. This would likely occur if the company continues to rely heavily on corporate-level debt financing to support its expansion plans, or if its financial performance falls short of our base-case forecast.

We could revise the outlook to stable if Innergex deleverages at the holdco level and builds a reasonable cushion in its credit metrics. We would look for FFO-to-debt of at least 24%-26% on a sustained basis before revising the outlook.

Affected issues are INE.PR.A and INE.PR.C.

The now-cancelled Watch-Negative was previously reported on PrefBlog.

Intact Financial Corporation has announced:

that it has closed its previously announced bought deal offering (the “Offering”) of Non-Cumulative Class A Shares, Series 9 (the “Series 9 Preferred Shares”) underwritten by a syndicate of underwriters led by TD Securities Inc. together with BMO Capital Markets, CIBC Capital Markets, National Bank Financial, RBC Capital Markets and Scotiabank, resulting in aggregate gross proceeds (including the proceeds resulting from the exercise of their option) to IFC of $150 million. The net proceeds from the Offering will be used by IFC for general corporate purposes.

Each Series 9 Preferred Share entitles the holder thereof to receive quarterly non-cumulative preferential cash dividends, if, as and when declared by the Board of Directors, on the last day of March, June, September and December in each year at a rate equal to $0.3375 per share. The initial dividend, if declared, will be paid on June 30, 2020 and will be $0.4906 per share.

The Series 9 Preferred Shares will commence trading today on the Toronto Stock Exchange under the symbol IFC.PR.I.

IFC.PR.I is a Straight Perpetual 5.40% issue announced 2020-2-6. It will be tracked by HIMIPref™ and has been assigned to the PerpetualPremium sub-index.

The issue traded 743,673 shares today in a range of 25.10-32 before closing at 25.21-22. Vital statistics are:

It will be recalled that ENB.PF.C will reset at 3.938% effective March 1, 2020.

ENB.PF.C is a FixedReset, 4.40%+264, that commenced trading 2014-5-22 after being announced 2014-5-12. The issue is tracked by HIMIPref™ but is relegated to the Scraps – FixedReset – Discount subindex on credit concerns.

The most logical way to analyze the question of whether or not to convert is through the theory of Preferred Pairs, for which a calculator is available. Briefly, a Strong Pair is defined as a pair of securities that can be interconverted in the future (e.g. ENB.PF.C and the FloatingReset that will arise if enough holders convert). Since they will be interconvertible on this future date, it may be assumed that they will be priced identically on this date (if they aren’t then holders will simply convert en masse to the higher-priced issue). And since they will be priced identically on a given date in the future, any current difference in price must be offset by expectations of an equal and opposite value of dividends to be received in the interim. And since the dividend rate on one element of the pair is both fixed and known, the implied average rate of the other, floating rate, instrument can be determined. Finally, we say, we may compare these average rates and take a view regarding the actual future course of that rate relative to the implied rate, which will provide us with guidance on which element of the pair is likely to outperform the other until the next interconversion date, at which time the process will be repeated.

We can show the break-even rates for each FixedReset / FloatingReset Strong Pair graphically by plotting the implied average 3-month bill rate against the next Exchange Date (which is the date to which the average will be calculated).

Click for Big

The market appears to have lost its fleeting interest in floating rate product; the implied rates until the next interconversion are generally below the current 3-month bill rate as the averages for investment-grade and junk issues are at +0.85% and +1.66%, respectively, after discarding the junk outlying pair AIM.PR.A / AIM.PR.B, which resets on 2020-3-31. Whatever might be the result of the next few Bank of Canada overnight rate decisions, I suggest that it is unlikely that the average rate over the next five years will be lower than current – but if you disagree, of course, you may interpret the data any way you like.

Since credit quality of each element of the pair is equal to the other element, it should not make any difference whether the pair examined is investment-grade or junk, although we might expect greater variation of implied rates between junk issues on grounds of lower liquidity, and this is just what we see.

If we plug in the current bid price of the ENB.PF.C FixedReset, we may construct the following table showing consistent prices for its soon-may-be-issued FloatingReset counterpart given a variety of Implied Breakeven yields consistent with issues currently trading:

Based on current market conditions, I suggest that the FloatingResets that will result from conversion are likely to trade below the price of their FixedReset counterparts, ENB.PF.C. Therefore, I recommend that holders of ENB.PF.C continue to hold the issue and not to convert. I will note that once the FloatingResets commence trading (if, in fact, they do) it may be a good trade to swap one issue for the other in the market once both elements of each pair are trading and you can – hopefully – do it with a reasonably good take-out in price, rather than doing it through the company on a 1:1 basis. But that, of course, will depend on the prices at that time and your forecast for the path of policy rates over the next five years. There are no guarantees – my recommendation is based on the assumption that current market conditions with respect to the pairs will continue until the FloatingResets commence trading and that the relative pricing of the two new pairs will reflect these conditions.

Those who wish to convert are advised that the deadline for notifying the company of such a desire is 5:00 p.m. (EST) on February 18, 2020. Brokers and other intermediaries generally set their internal deadlines a day or two in advance of this date, so if you wish to convert there’s no time to waste! Note that brokers will, in general, try to execute the instruction on a ‘best efforts’ basis if received between the two deadlines, provided that the procrastinating shareholder grovels entertainingly enough.

Emera Incorporated has announced (on February 6):

that after having taken into account all conversion notices received from holders of its outstanding Cumulative Rate Reset First Preferred Shares, Series F (the “Series F Shares”) by the January 31, 2020 deadline for conversion notices, less than the 1,000,000 Series F Shares required to give effect to conversions into Cumulative Floating Rate First Preferred Shares, Series G (the “Series G Shares”) were tendered for conversion. As a result, none of Emera’s outstanding Series F Shares will be converted into Series G Shares on February 15, 2020. The Series F Shares will continue to be listed on the Toronto Stock Exchange (TSX) under the symbol EMA.PR.F.

EMA.PR.F is a FixedReset, 4.25%+263, that commenced trading 2014-6-9 after being being announced 2014-5-29. The company announced the extension on 2020-1-7. EMA.PR.F will reset at 4.202% effective February 15, 2020. I recommended against conversion. EMA.PR.F is tracked by HIMIPref™ and assigned to the FixedReset Discount subindex.

Manulife Financial Corporation has announced (on February 3, but not yet on their website):

that it does not intend to exercise its right to redeem all or any of its currently outstanding 10,000,000 Non-cumulative Rate Reset Class 1 Shares Series 19 (the “Series 19 Preferred Shares”) (TSX: MFC.PR.N) on March 19, 2020. As a result, subject to certain conditions described in the prospectus supplement dated November 26, 2014 relating to the issuance of the Series 19 Preferred Shares (the “Prospectus”), the holders of the Series 19 Preferred Shares have the right, at their option, to convert all or part of their Series 19 Preferred Shares on a one-for-one basis into Non-cumulative Floating Rate Class 1 Shares Series 20 of Manulife (the “Series 20 Preferred Shares”) on March 19, 2020. A formal notice of the right to convert Series 19 Preferred Shares into Series 20 Preferred Shares will be sent to the registered holders of the Series 19 Preferred Shares in accordance with the share conditions of the Series 19 Preferred Shares. Holders of Series 19 Preferred Shares are not required to elect to convert all or any part of their Series 19 Preferred Shares into Series 20 Preferred Shares. Holders who do not exercise their right to convert their Series 19 Preferred Shares into Series 20 Preferred Shares on such date will retain their Series 19 Preferred Shares, unless automatically converted in accordance with the conditions below.

The foregoing conversion right is subject to the conditions that: (i) if, after March 4, 2020, Manulife determines that there would be less than 1,000,000 Series 19 Preferred Shares outstanding on March 19, 2020, then all remaining Series 19 Preferred Shares will automatically be converted into an equal number of Series 20 Preferred Shares on March 19, 2020, and (ii) alternatively, if, after March 4, 2020, Manulife determines that there would be less than 1,000,000 Series 20 Preferred Shares outstanding on March 19, 2020, then no Series 19 Preferred Shares will be converted into Series 20 Preferred Shares. In either case, Manulife will give written notice to that effect to any registered holders of Series 19 Preferred Shares affected by the preceding minimums on or before March 11, 2020.

The dividend rate applicable to the Series 19 Preferred Shares for the 5-year period commencing on March 20, 2020, and ending on March 19, 2025, and the dividend rate applicable to the Series 20 Preferred Shares for the 3-month period commencing on March 20, 2020, and ending on June 19, 2020, will be determined and announced by way of a news release on February 19, 2020. Manulife will also give written notice of these dividend rates to the registered holders of Series 19 Preferred Shares.

Beneficial owners of Series 19 Preferred Shares who wish to exercise their right of conversion should instruct their broker or other nominee to exercise such right before 5:00 p.m. (Toronto time) on March 4, 2020. Conversion inquiries should be directed to Manulife’s Registrar and Transfer Agent, AST Trust Company (Canada), at 1-800-783-9495.

Subject to certain conditions described in the Prospectus, Manulife may redeem the Series 19 Preferred Shares, in whole or in part, on March 19, 2025 and on March 19 every five years thereafter and may redeem the Series 20 Preferred Shares, in whole or in part, after March 19, 2020.

The Toronto Stock Exchange (“TSX”) has conditionally approved the listing of the Series 20 Preferred Shares effective upon conversion. Listing of the Series 20 Preferred Shares is subject to Manulife fulfilling all the listing requirements of the TSX and, upon approval, the Series 20 Preferred Shares will be listed on the TSX under the trading symbol “MFC.PR.S”.

MFC.PR.N is a FixedReset, 3.80%+230, that commenced trading 2014-12-3 after being announced 2014-11-26. It is tracked by HIMIPref™ and is assigned to the FixedReset – Insurance non-NVCC subindex.

I will have more to say when the reset rate is announced on February 19.

National Bank of Canada has announced:

that none of its outstanding 12,000,000 Non-Cumulative 5-Year Rate Reset First Preferred Shares, Series 32 (the “Series 32 Preferred Shares”) will be converted on February 15, 2020 into Non-Cumulative Floating Rate First Preferred Shares, Series 33 (the “Series 33 Preferred Shares”).

During the conversion period, 58,495 Series 32 Preferred Shares were tendered for conversion into Series 33 Preferred Shares, which is less than the minimum 1,000,000 required to give effect to the conversion, as per the terms of the Series 32 Preferred Shares described in the prospectus supplement dated October 2, 2014.

As a result, no Series 33 Preferred Shares will be issued on February 15, 2020 and holders of Series 32 Preferred Shared will retain their shares.

The Series 32 Preferred Shares are currently listed on the Toronto Stock Exchange under the symbol NA.PR.W. The annual dividend rate for such shares for the five-year period commencing on February 16, 2020, and ending on February 15, 2025, will be 3.839% .

It will be recalled that NA.PR.W will reset at 3.839% effective February 16, 2020.

NA.PR.W is a FixedReset, 3.90%+225, that commenced trading 2014-10-9 after being announced 2014-9-30. The company announced the extension on 2019-12-19. NA.PR.W will reset at 3.839% effective February 16, 2020. I recommended against conversion. The issue is tracked by HIMIPref™ and is assigned to the FixedReset (Discount) subindex.