Another preferred fund is going down:
National Bank Investments Inc. (“NBI”) announces that, effective today, the units of all series of the NBI Canadian Preferred Equity Private Portfolio (the “Fund”) will no longer be available for purchase by new or existing unitholders, including purchases made through a pre-authorized purchase plan.
NBI was informed that a substantial portion of the Fund’s units will be redeemed progressively in the coming months. Effective immediately, the portfolio sub-advisor, Fiera Capital Corporation, will carry out a progressive and orderly liquidation of the Fund’s assets over this period in order to meet redemption requests. While care will be given to remain invested in accordance with the Fund’s investment objective and strategies, the preferred equity market presents unique challenges. As such, the Fund’s portfolio sub-advisor may, from time to time, depart from the investment objective and strategies stated in the Fund’s prospectus.
During the liquidation period, NBI will assess whether the Fund should ultimately, in the best interest of its unitholders, be terminated or merged with another NBI Fund, depending on market conditions.
The above changes will be reflected in the upcoming amendment to the simplified prospectus for the NBI Funds which will be available on the SEDAR+ website (www.sedarplus.ca) and the National Bank Investments website (www.nbinvestments.ca).
This one had assets of 152-million on 2023-3-31.
| HIMIPref™ Preferred Indices These values reflect the December 2008 revision of the HIMIPref™ Indices Values are provisional and are finalized monthly |
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| 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 | -0.5184 % | 2,225.3 |
| FixedFloater | 0.00 % | 0.00 % | 0 | 0.00 | 0 | -0.5184 % | 4,268.1 |
| Floater | 10.94 % | 11.21 % | 44,754 | 8.60 | 2 | -0.5184 % | 2,459.7 |
| OpRet | 0.00 % | 0.00 % | 0 | 0.00 | 0 | 0.2411 % | 3,354.5 |
| SplitShare | 5.02 % | 7.61 % | 42,788 | 2.07 | 8 | 0.2411 % | 4,006.0 |
| Interest-Bearing | 0.00 % | 0.00 % | 0 | 0.00 | 0 | 0.2411 % | 3,125.7 |
| Perpetual-Premium | 0.00 % | 0.00 % | 0 | 0.00 | 0 | 0.2908 % | 2,560.2 |
| Perpetual-Discount | 6.70 % | 6.82 % | 46,631 | 12.78 | 31 | 0.2908 % | 2,791.7 |
| FixedReset Disc | 5.85 % | 8.45 % | 86,893 | 11.21 | 56 | -0.1171 % | 2,142.7 |
| Insurance Straight | 6.64 % | 6.75 % | 55,460 | 12.81 | 18 | -0.1514 % | 2,710.3 |
| FloatingReset | 10.93 % | 11.21 % | 32,714 | 8.60 | 1 | 2.2418 % | 2,420.7 |
| FixedReset Prem | 7.03 % | 7.05 % | 238,399 | 3.67 | 1 | -0.0400 % | 2,299.8 |
| FixedReset Bank Non | 0.00 % | 0.00 % | 0 | 0.00 | 0 | -0.1171 % | 2,190.3 |
| FixedReset Ins Non | 6.41 % | 8.05 % | 72,686 | 11.48 | 10 | -0.2977 % | 2,307.9 |
| Performance Highlights | |||
| Issue | Index | Change | Notes |
| PWF.PR.T | FixedReset Disc | -6.74 % | YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2053-08-08 Maturity Price : 17.58 Evaluated at bid price : 17.58 Bid-YTW : 8.89 % |
| BN.PF.A | FixedReset Disc | -2.64 % | YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2053-08-08 Maturity Price : 19.89 Evaluated at bid price : 19.89 Bid-YTW : 8.66 % |
| MFC.PR.K | FixedReset Ins Non | -2.53 % | YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2053-08-08 Maturity Price : 19.25 Evaluated at bid price : 19.25 Bid-YTW : 8.05 % |
| BIP.PR.E | FixedReset Disc | -2.31 % | YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2053-08-08 Maturity Price : 20.27 Evaluated at bid price : 20.27 Bid-YTW : 8.53 % |
| SLF.PR.C | Insurance Straight | -2.29 % | YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2053-08-08 Maturity Price : 17.05 Evaluated at bid price : 17.05 Bid-YTW : 6.63 % |
| BN.PR.T | FixedReset Disc | -1.79 % | YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2053-08-08 Maturity Price : 13.75 Evaluated at bid price : 13.75 Bid-YTW : 10.06 % |
| BN.PR.X | FixedReset Disc | -1.73 % | YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2053-08-08 Maturity Price : 14.22 Evaluated at bid price : 14.22 Bid-YTW : 9.56 % |
| BN.PR.R | FixedReset Disc | -1.45 % | YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2053-08-08 Maturity Price : 13.55 Evaluated at bid price : 13.55 Bid-YTW : 10.23 % |
| GWO.PR.S | Insurance Straight | -1.28 % | YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2053-08-08 Maturity Price : 19.25 Evaluated at bid price : 19.25 Bid-YTW : 6.93 % |
| BN.PR.M | Perpetual-Discount | 1.05 % | YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2053-08-08 Maturity Price : 17.25 Evaluated at bid price : 17.25 Bid-YTW : 7.00 % |
| RY.PR.M | FixedReset Disc | 1.11 % | YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2053-08-08 Maturity Price : 18.20 Evaluated at bid price : 18.20 Bid-YTW : 8.15 % |
| MFC.PR.B | Insurance Straight | 1.14 % | YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2053-08-08 Maturity Price : 17.80 Evaluated at bid price : 17.80 Bid-YTW : 6.65 % |
| FTS.PR.K | FixedReset Disc | 1.49 % | YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2053-08-08 Maturity Price : 17.00 Evaluated at bid price : 17.00 Bid-YTW : 8.78 % |
| POW.PR.C | Perpetual-Discount | 1.61 % | YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2053-08-08 Maturity Price : 21.86 Evaluated at bid price : 22.10 Bid-YTW : 6.64 % |
| CU.PR.I | FixedReset Disc | 2.15 % | YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2053-08-08 Maturity Price : 21.37 Evaluated at bid price : 21.37 Bid-YTW : 8.27 % |
| SLF.PR.J | FloatingReset | 2.24 % | YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2053-08-08 Maturity Price : 15.05 Evaluated at bid price : 15.05 Bid-YTW : 11.21 % |
| Volume Highlights | |||
| Issue | Index | Shares Traded |
Notes |
| FTS.PR.G | FixedReset Disc | 29,200 | YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2053-08-08 Maturity Price : 19.10 Evaluated at bid price : 19.10 Bid-YTW : 8.03 % |
| CM.PR.Q | FixedReset Disc | 21,300 | YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2053-08-08 Maturity Price : 17.73 Evaluated at bid price : 17.73 Bid-YTW : 8.64 % |
| FTS.PR.M | FixedReset Disc | 17,900 | YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2053-08-08 Maturity Price : 17.00 Evaluated at bid price : 17.00 Bid-YTW : 9.16 % |
| MFC.PR.Q | FixedReset Ins Non | 17,500 | YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2053-08-08 Maturity Price : 20.30 Evaluated at bid price : 20.30 Bid-YTW : 7.85 % |
| BN.PR.K | Floater | 12,300 | YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2053-08-08 Maturity Price : 11.50 Evaluated at bid price : 11.50 Bid-YTW : 11.24 % |
| BN.PF.F | FixedReset Disc | 12,100 | YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2053-08-08 Maturity Price : 16.22 Evaluated at bid price : 16.22 Bid-YTW : 10.16 % |
| There were 3 other index-included issues trading in excess of 10,000 shares. | |||
| Wide Spread Highlights | ||
| Issue | Index | Quote Data and Yield Notes |
| PWF.PR.T | FixedReset Disc | Quote: 17.58 – 18.84 Spot Rate : 1.2600 Average : 0.8043 YTW SCENARIO |
| BNS.PR.I | FixedReset Disc | Quote: 20.25 – 21.47 Spot Rate : 1.2200 Average : 0.7825 YTW SCENARIO |
| PVS.PR.H | SplitShare | Quote: 23.00 – 23.60 Spot Rate : 0.6000 Average : 0.3756 YTW SCENARIO |
| MFC.PR.K | FixedReset Ins Non | Quote: 19.25 – 19.80 Spot Rate : 0.5500 Average : 0.3439 YTW SCENARIO |
| BIP.PR.E | FixedReset Disc | Quote: 20.27 – 21.00 Spot Rate : 0.7300 Average : 0.5691 YTW SCENARIO |
| SLF.PR.C | Insurance Straight | Quote: 17.05 – 17.74 Spot Rate : 0.6900 Average : 0.5305 YTW SCENARIO |
While the optics on this are not great, it seems to me that this situation is somewhat unique.
This fund is a variation on National Bank’s other Preferred Equity funds ( including the much larger Preferred Equity Income Fund) but this one was for high net worth investors with a minimum of $ 250,000 to invest.
The press release suggests that the issue now is how to deal with redemption requests. Given the high threshold value per initial investment I wouldn’t be surprised if that in turn raises possible liquidity issues, unless the manager can now come up with a plan to address those requests in an orderly fashion.