PrefBlog

Canadian Western Bank has announced:

the applicable dividend rates for its non-cumulative 5-year rate reset First Preferred Shares Series 5 (the “Series 5 Preferred Shares”) (TSX: CWB.PR.B), non-cumulative floating rate First Preferred Shares Series 6 (the “Series 6 Preferred Shares”) …

Series 5 Preferred Shares
With respect to any Series 5 Preferred Shares that remain outstanding after April 30, 2024, commencing as of such date, 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 CWB and subject to the provisions of the Bank Act (Canada). The dividend rate for the five-year period commencing on May 1, 2024, and ending on April 30, 2029, will be 6.371% per annum or $0.3981875 per share per quarter, being equal to the sum of the five-year Government of Canada bond yield as at April 1, 2024, plus 2.76%, as determined in accordance with the terms of the Series 5 Preferred Shares.

With respect to any Series 6 Preferred Shares that may be issued on May 1, 2024 in connection with the conversion of the Series 5 Preferred Shares into the Series 6 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 CWB and subject to the provisions of the Bank Act (Canada). The dividend rate for the three-month period commencing on May 1, 2024, and ending on July 31, 2024, will be 1.940% (7.759% on an annualized basis) or $0.4849375 per share, being equal to the sum of the three-month Government of Canada Treasury bill yield as at April 1, 2024, plus 2.76%, as determined in accordance with the terms of the Series 6 Preferred Shares.

Beneficial owners of Series 5 Preferred Shares who wish to retain their Series 5 Preferred Shares do not need to take any further action. Beneficial owners of Series 5 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. (EDT) on April 15, 2024. The news release announcing such conversion right was issued on March 21, 2024 and can be viewed on SEDAR+ or CWB’s website. Conversion inquiries should be directed to CWB’s Registrar and Transfer Agent, Computershare Trust Company of Canada, at 1-800-564-6253.

CWB.PR.B was issued as a FixedReset, 4.40%+276, that commenced trading 2014-2-10 after being announced 2014-1-31. The extension was announced 2019-3-11. It reset at 4.301% effective 2019-5-1. I recommended against conversion and there was no conversion. Notice of extension was announced 2024-3-21. The issue is tracked by HIMIPref™ but relegated to the Scraps – FixedReset (Discount) index on credit concerns.

This entry was posted on Monday, April 1st, 2024 at 7:45 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.