PrefBlog

The Bank of Montreal has announced:

its intention to redeem all of its US$300,000,000 Non-cumulative Perpetual Class B Preferred Shares Series 10 (“Preferred Shares Series 10”) on February 25, 2012.

Having satisfied all conditions precedent, the Preferred Shares Series 10 are redeemable at Bank of Montreal’s option on February 25, 2012, at a redemption price of US$25.00 per share plus all declared and unpaid dividends up to but excluding the date fixed for redemption. Because February 25, 2012, is a Saturday, payment of the redemption price will be made by Bank of Montreal on or after February 27, 2012, upon surrender of the Preferred Shares Series 10.

Separately from the payment of the redemption price, the final quarterly dividend of US$0.371875 per share for the Preferred Shares Series 10 will be paid in the usual manner on February 27, 2012, to shareholders of record on February 1, 2012.

Notice will be delivered to holders of the Preferred Shares Series 10 in accordance with the terms outlined in the Preferred Shares Series 10 prospectus.

This is a rather peculiar issue, since the USD / CAD exchange rate was much different on issue date ten years ago than it was today! Hence, as previously noted, the paid up capital on these shares is somewhere around CAD $39.44.

I have been attempting to get an authoritative opinion on the tax implications, if any, of this unusual situation, but to date without successs.

BMO.PR.V is not tracked by HIMIPref™.

This entry was posted on Thursday, January 19th, 2012 at 11:56 am and is filed under Issue Comments. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.