PrefBlog

The Bank of Nova Scotia has announced:

its intention to redeem (i) all outstanding CDN $1,750 million 3.89% Subordinated Debentures (Non-Viability Contingent Capital (NVCC)) due January 18, 2029 (the “Debentures”) at 100% of their principal amount plus accrued and unpaid interest to but excluding the date fixed for redemption, and (ii) all outstanding Non-cumulative 5-Year Rate Reset Preferred Shares Series 40 (Non-Viability Contingent Capital (NVCC)) (“Series 40 Shares”) at a price equal to $25.00 per share together with dividends declared and unpaid prior to the redemption. The redemptions of the Debentures and Series 40 Shares will occur on January 18, 2024, and January 29, 2024, respectively. Formal notice will be delivered to the debenture holders in accordance with the terms and conditions set forth in the related trust indenture.

On November 28, 2023, the Board of Directors of Scotiabank declared a quarterly dividend of $0.303125 per Series 40 Share. This will be the final dividend of the Series 40 Shares and will be paid on January 29, 2024, to shareholders of record at the close of business on January 3, 2024, as previously announced. Subsequent to this final dividend payment, the Series 40 Shares will cease to be entitled to dividends.

The redemptions of the Debentures and Series 40 Shares have been approved by the Office of the Superintendent of Financial Institutions and will be financed out of the general funds of Scotiabank. These redemptions are part of the Bank’s ongoing management of its Tier 1 and Tier 2 capital.

BNS.PR.I is a FixedReset, 4.85%+243, NVCC, issue that commenced trading 2018-10-12 after being announced 2018-10-2. It has been tracked by HIMIPref™ and has been assigned to the FixedReset-Discount sub-index.

This obviously comes as a surprise, since the issue closed today with a quote of 23.20-25. Sometimes, Santa comes early!

Thanks to Assiduous Reader Peculiar_Investor for bringing this to my attention!

Power Financial Corporation has announced:

that it does not intend to exercise its right to redeem all or part of the currently outstanding 8,000,000 Non-Cumulative 5-Year Rate Reset First Preferred Shares, Series T (the “Series T shares”) on January 31, 2024. As a result, subject to certain conditions, the holders of the Series T shares have the right to convert all or part of their Series T shares, on a one-for-one basis, into Non-Cumulative Floating Rate First Preferred Shares, Series U (the “Series U shares”) on January 31, 2024 (the “Conversion Date”) pursuant to the terms and conditions of the Series T shares.

Holders of Series T shares who do not exercise their right to convert their Series T shares into Series U shares on the Conversion Date will retain their Series T shares, subject to certain conditions.

The foregoing conversion rights are subject to the conditions that: (i) if Power Financial determines that there would be outstanding on the Conversion Date less than 1,000,000 Series U shares, after having taken into account all Series T shares tendered for conversion into Series U shares, then holders of Series T shares will not be entitled to convert their shares into Series U shares, and (ii) alternatively, if Power Financial determines that there would remain outstanding on the Conversion Date less than 1,000,000 Series T shares, after having taken into account all Series T shares tendered for conversion into Series U shares, then all remaining Series T shares will automatically be converted into Series U shares without the consent of the holders, on a one-for-one basis, on the Conversion Date. In either case, Power Financial will give written notice to that effect to the registered holder of Series T shares no later than January 24, 2024.

The dividend rate applicable to the Series T shares for the 5-year period from January 31, 2024 to but excluding January 31, 2029, and the dividend rate applicable to the Series U shares for the 3-month period from January 31, 2024 to but excluding April 30, 2024, will be determined and announced by way of a news release on January 2, 2024.

Beneficial owners of Series T shares who wish to exercise their conversion right should communicate with their broker or other nominee to obtain instructions for exercising such right during the conversion period, which runs from January 2, 2024 until January 16, 2024 at 5:00 p.m. (Eastern Time).

PWF.PR.T was issued as a FixedReset, 4.20%+237, that commenced trading 2013-12-11 after being announced 2013-12-2. PWF.PR.T reset at 4.215% effective 2019-1-31. I recommended against conversion and there was no conversion. It is tracked by HIMIPref™ and is assigned to the FixedReset Discount subindex.

Thanks to Assiduous Reader NK for bringing this to my attention!

Brookfield Infrastructure Partners L.P. has announced:

that it has determined the fixed distribution rate on its Cumulative Class A Preferred Limited Partnership Units, Series 11 (“Series 11 Units”) (TSX: BIP.PR.F) for the five years commencing January 1, 2024 and ending December 31, 2028.

Series 11 Units and Series 12 Units

If declared, the fixed quarterly distributions on the Series 11 Units during the five years commencing January 1, 2024 will be paid at an annual rate of 6.446% ($0.402875 per unit per quarter).

Holders of Series 11 Units have the right, at their option, exercisable not later than 5:00 p.m. (Toronto time) on December 18, 2023, to reclassify all or part of their Series 11 Units, on a one-for-one basis, into Cumulative Class A Preferred Limited Partnership Units, Series 12 (“Series 12 Units”), effective December 31, 2023.

The quarterly floating rate distributions on the Series 12 Units will be paid at an annual rate, calculated for each quarter, of 2.92% over the annual yield on three-month Government of Canada treasury bills. The actual quarterly distribution rate in respect of the January 1, 2024 to March 31, 2024 distribution period for the Series 12 Units will be 1.98505% (7.962% on an annualized basis) and the distribution, if declared, for such distribution period will be $0.4962625 per unit, payable on March 31, 2024.

Holders of Series 11 Units are not required to elect to reclassify all or any part of their Series 11 Units into Series 12 Units.

As provided in the unit conditions of the Series 11 Units, (i) if Brookfield Infrastructure determines that there would be fewer than 1,000,000 Series 11 Units outstanding after December 31, 2023, all remaining Series 11 Units will be automatically reclassified into Series 12 Units on a one-for-one basis effective December 31, 2023; or (ii) if Brookfield Infrastructure determines that there would be fewer than 1,000,000 Series 12 Units outstanding after December 31, 2023, no Series 11 Units will be reclassified into Series 12 Units. There are currently 9,936,190 Series 11 Units outstanding.

The Toronto Stock Exchange (“TSX”) has conditionally approved the listing of the Series 12 Units effective upon reclassification. Listing of the Series 12 Units is subject to Brookfield Infrastructure fulfilling all the listing requirements of the TSX.

BIP.PR.F was issued as a FixedReset, 5.10%+292M510, that commenced trading 2018-9-12 after being announced 2018-09-05. As previously discussed, the issue’s distributions are complex (and may involve return of capital) and converting the issue may be a Deemed Disposition for tax purposes. It has been assigned to the FixedReset-Discount subindex.

Thanks to Assiduous Readers NK, CanSiamCyp and Fuzzybear for bringing this to my attention

Update, 2023-12-11: The information given in this post has been corrected by the company. The rate is actually 6.576%

Algonquin Power & Utilities Corp. has announced:

the applicable dividend rates for its Cumulative Rate Reset Preferred Shares, Series A (the “Series A Preferred Shares”) and Cumulative Floating Rate Preferred Shares, Series B (the “Series B Preferred Shares”).

With respect to any Series A Preferred Shares that remain outstanding after January 2, 2024, holders thereof will be entitled to receive quarterly fixed cumulative preferential cash dividends, if, as and when declared by the board of directors of the Company (the “Board”). The dividend rate for the 5-year period from and including December 31, 2023 to but excluding December 31, 2028 will be 6.469% [see note above; rate is actually 6.576%], being equal to the 5-year Government of Canada bond yield determined as of today plus 2.94%, in accordance with the terms of the Series A Preferred Shares.

With respect to any Series B Preferred Shares that may be issued on January 2, 2024, holders thereof will be entitled to receive quarterly floating rate cumulative preferential cash dividends, if, as and when declared by the Board. The dividend rate for the 3-month floating rate period from and including December 31, 2023 to but excluding March 31, 2024 will be 7.982%, being equal to the 3-month Government of Canada Treasury Bill yield determined as of today plus 2.94%, calculated on the basis of the actual number of days in such quarterly period divided by 365, in accordance with the terms of the Series B Preferred Shares.

Beneficial owners of Series A Preferred Shares who wish to exercise their conversion right should communicate with their broker or other nominee to ensure their instructions are followed so that the registered holder of the Series A Preferred Shares can meet the deadline to exercise such conversion right, which is 5:00 p.m. (EST) on December 18, 2023.

AQN.PR.A was issued as a FixedReset, 4.50%+294, that commenced trading 2012-11-9 after being announced 2012-10-25. The 2018-11-28 notice of extension was reported on PrefBlog. The issue reset at 5.162% effective December 31, 2018. I recommended against conversion and there was no conversion. Notice of extension was issued in 2023. The issue is tracked by HIMIPref™, but relegated to the Scraps – FixedReset Discount index on credit concerns.

Thanks to Assiduous Reader Fuzzybear for bringing this to my attention!