PrefBlog

Brompton Funds has announced:

As a result of strong performance, Brompton Split Banc Corp. (the “Company”) is pleased to announce that the board of directors has approved an extension of the maturity date of the Class A and Preferred shares of the Company for an additional 5-year term to November 29, 2027. The reset preferred share dividend rate for the extended term will be announced at least 60 days prior to the original November 29, 2022 maturity date and will be based on market yields for preferred shares with similar terms at that time.

The term extension allows Class A shareholders to continue to invest in the Canadian bank sector with an attractive distribution rate of 8.4% based on the March 22, 2022 closing price and the opportunity for capital appreciation. Canadian banks continue to offer attractive dividend yields and return on equity. As well, the extension of the term of the Company is not a taxable event and enables shareholders to defer potential capital gains tax liability that would have otherwise been realized on the redemption of the Class A shares or Preferred Shares at the end of the term, until such time as such shares are disposed of by shareholders.

Since inception in November 2005 to February 28, 2022, the Class A shares have delivered a 13.2% per annum total return, outperforming the S&P/TSX Capped Financials Index by 3.8% per annum and the S&P/TSX Composite Index by 5.8% per annum.(1) Since inception to February 28, 2022, Class A shareholders have received cash distributions of $19.15 per share. Class A shareholders also have the option to reinvest their cash distributions in a dividend reinvestment plan which is commission free to participants.

The term extension offers Preferred shareholders the opportunity to enjoy preferential cash dividends until November 29, 2027. Since inception, the Preferred shares have delivered a 5.1% per annum total return, outperforming the S&P/TSX Preferred Share Index by 2.2% per annum with lower volatility.(1)

Brompton Split Banc Corp. invests, on an approximately equal weighted basis in a portfolio consisting of common shares of the six largest Canadian banks (currently, Bank of Montreal, Canadian Imperial Bank of Commerce, National Bank of Canada, Royal Bank of Canada, The Bank of Nova Scotia and The TorontoDominion Bank). In addition, the Company may hold up to 10% of the total assets of the Portfolio in investments in global financial companies for the purposes of enhanced diversification and return potential.

This entry was posted on Thursday, March 24th, 2022 at 8:13 pm 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.