PrefBlog

Bank of Montreal has announced:

that it does not intend to exercise its right to redeem the currently outstanding Non-Cumulative 5-Year Rate Reset Class B Preferred Shares, Series 44 (Non-Viability Contingent Capital (NVCC)) of the Bank (the “Preferred Shares Series 44”) on November 25, 2023. As a result, subject to certain conditions, the holders of Preferred Shares Series 44 have the right, at their option, to convert all or part of their Preferred Shares Series 44 on a one-for-one basis into Non-Cumulative Floating Rate Class B Preferred Shares, Series 45 (Non-Viability Contingent Capital (NVCC)) of the Bank (the “Preferred Shares Series 45”) on November 25, 2023. Holders who do not exercise their right to convert their Preferred Shares Series 44 into Preferred Shares Series 45 on such date will retain their Preferred Shares Series 44, unless automatically converted in accordance with the conditions below.

The foregoing conversions are subject to the conditions that:

(i) if, after November 10, 2023, the Bank determines that there would be fewer than 1,000,000 Preferred Shares Series 44 outstanding on November 25, 2023 after giving effect to such conversions, then all remaining Preferred Shares Series 44 will automatically be converted into an equal number of Preferred Shares Series 45 on November 25, 2023; and

(ii) alternatively, if the Bank determines that there would be fewer than 1,000,000 Preferred Shares Series 45 outstanding on November 25, 2023 after giving effect to such conversions, then no Preferred Shares Series 44 will be converted into Preferred Shares Series 45.

In either case, the Bank will give written notice to that effect to any registered holders of Preferred Shares Series 44 affected by the preceding minimums on or before November 17, 2023.

The dividend rate applicable to the Preferred Shares Series 44 for the 5-year period commencing on November 25, 2023 to, but excluding, November 25, 2028, and the dividend rate applicable to the Preferred Shares Series 45 for the 3-month period commencing on November 25, 2023 to, but excluding, February 25, 2024, will be determined and announced by way of a news release on October 26, 2023. The Bank will also give written notice of these dividend rates to the registered holders of Preferred Shares Series 44.

Beneficial owners of Preferred Shares Series 44 who, on or after October 25, 2023, wish to exercise their right of conversion should instruct their broker or other nominee to exercise such right before 5:00 p.m. (ET) on November 10, 2023.

Conversion inquiries should be directed to BMO’s Registrar and Transfer Agent, Computershare Trust Company of Canada, at 1-800-340-5021

BMO.PR.E was issued as a FixedReset, 4.85%+268, that commenced trading 2018-9-17 after being announced 2018-09-06. It is tracked by HIMIPref™ and is assigned to the FixedReset (Discount) subindex.

National Bank of Canada has announced:

Further to its announcement of September 20, 2023, National Bank of Canada (the “Bank”) (TSX: NA) announced today the dividend rates applicable to the Non-Cumulative 5‑Year Rate Reset First Preferred Shares, Series 42 Non-Viability Contingent Capital (NVCC) (the “Series 42 Shares”) and the Non-Cumulative Floating Rate First Preferred Shares, Series 43 (NVCC) (the “Series 43 Shares”).

Holders of Series 42 Shares, should any remain outstanding after November 15, 2023, 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 the Bank and subject to the provisions of the Bank Act (Canada). The dividend rate for the five-year period commencing on November 16, 2023, and ending on November 15, 2028, will be 7.056%, being equal to the sum of the five-year Government of Canada Bond yield (4.286%) plus 2.77%, as determined in accordance with the terms of the Series 42 Shares.
Holders of Series 43 Shares, should any be issued on November 15, 2023, will be entitled to receive floating rate non-cumulative preferential cash dividends on a quarterly basis, as and when declared by the Board of Directors of the Bank and subject to the provisions of the Bank Act (Canada). The dividend rate for the three-month period commencing on November 16, 2023, and ending on February 15, 2024, will be 7.93%, being equal to the sum of the 90-day Government of Canada Treasury Bill yield (5.16%) plus 2.77%, calculated on the basis of actual number of days elapsed in such quarterly floating rate period divided by 365, as determined in accordance with the terms of the Series 43 Shares.

Holders of the Series 42 Shares have, subject to certain conditions, the right to convert all or part of their Series 42 Shares on a one-for-one basis into Series 43 Shares on November 15, 2023.

Beneficial owners of Series 42 shares who wish to exercise their conversion right should communicate as soon as possible with their broker or other nominee and ensure that they follow their instructions in order to meet the deadline to exercise such right, which is October 31, 2023, at 5:00 p.m. (EDT).

The September 20 press release referenced above stated:

National Bank of Canada (“National Bank”) (TSX: NA) announced today that it does not intend to exercise its right to redeem all or part of the currently outstanding 12,000,000 Series 42 Shares on November 15, 2023. As a result, subject to certain conditions, the holders of the Series 42 Shares will have the right to convert all or part of their Series 42 Shares on a one-for-one basis into Non-Cumulative Floating Rate First Preferred Shares, Series 43 (NVCC) (the “Series 43 Shares”) on November 15, 2023, in accordance with the terms of the Series 42 Shares described in the prospectus supplement dated June 4, 2018.

Holders who do not exercise their right to convert their Series 42 Shares into Series 43 Shares on November 15, 2023, will retain their Series 42 Shares.

The foregoing conversions are subject to the conditions that:

i. if National Bank determines that there would remain outstanding on November 15, 2023, less than 1,000,000 Series 43 Shares, after having taken into account all Series 42 Shares tendered for conversion into Series 43 Shares, then holders of Series 42 Shares will not be entitled to convert their shares into Series 43 Shares, and

ii. alternatively, if National Bank determines that there would remain outstanding on November 15, 2023, less than 1,000,000 Series 42 Shares, after having taken into account all Series 42 Shares tendered for conversion into Series 43 Shares, then all remaining Series 42 Shares will automatically be converted into Series 43 Shares without the consent of the holders on November 15, 2023.

In either case, National Bank shall give a notice to that effect to all registered holders of Series 42 Shares no later than November 8, 2023.

On October 17, 2023, National Bank will give notice of:

i. the annual fixed dividend rate applicable to the Series 42 Shares to which a holder of Series 42 Shares will be entitled for the 5-year period from November 16, 2023, up to and including November 15, 2028; and

ii. the floating quarterly dividend rate applicable to the Series 43 Shares to which a holder of Series 43 Shares will be entitled for the 3-month period from November 16, 2023, up to and including February 15, 2024.

Beneficial owners of Series 42 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 will run from October 16, 2023, until October 31, 2023, at 5:00 p.m. (EDT).

NA.PR.G was issued as a FixedReset, 4.95%+277, NVCC compliant, that commenced trading 2018-6-11 after being announced 2018-05-31. It is tracked by HIMIPref™ and is assigned to the FixedResets (Discount) subindex.

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

BCE Inc. renewed its Normal Course Issuer Bid on 2022-11-2:

BCE Inc. (BCE) today announced that the Toronto Stock Exchange (the “TSX”) has accepted a notice filed by BCE of its intention to renew its normal course issuer bid (“NCIB”) to purchase up to 10% of the public float of each series of BCE’s outstanding First Preferred Shares that are listed on the TSX (the “Preferred Shares”). The period of the NCIB will extend from November 9, 2022 to November 8, 2023, or an earlier date should BCE complete its purchases under the NCIB. BCE will pay the prevailing market price at the time of acquisition for any Preferred Shares purchased plus brokerage fees payable by BCE (except with respect to purchases made under an issuer bid exemption order, which will be at a discount to the prevailing market price), and all Preferred Shares acquired by BCE under the NCIB will be cancelled.

The actual number of Preferred Shares repurchased under the NCIB and the timing of such repurchases will be at BCE’s discretion and shall be subject to the limitations set out in the TSX Company Manual.

The NCIB will be conducted through a combination of discretionary transactions and purchases under an automatic securities purchase plan through the facilities of the TSX as well as alternative trading systems in Canada, if eligible, or by such other means as may be permitted by securities regulatory authorities, including pre-arranged crosses, exempt offers, private agreements under an issuer bid exemption order issued by securities regulatory authorities and block purchases of Preferred Shares. Purchases made under an issuer bid exemption order will be at a discount to the prevailing market price.

Under the NCIB, BCE is authorized to repurchase shares of each respective series of the Preferred Shares as follows:

Series	Ticker	Issued and Outstanding Shares(1)	Public Float(1)	Average Daily Trading Volume(2)	Maximum Number of Shares Subject to Purchase
					Total(3)	Daily(4)
R	BCE.PR.R	7,998,900	7,998,900	4,055	799,890	1,013
S	BCE.PR.S	2,128,267	2,128,267	1,067	212,826	1,000
T	BCE.PR.T	5,870,133	5,870,133	11,269	587,013	2,817
Y	BCE.PR.Y	8,079,291	8,079,291	6,383	807,929	1,595
Z	BCE.PR.Z	1,918,509	1,918,509	659	191,850	1,000
AA	BCE.PR.A	12,307,661	12,307,661	9,932	1,230,766	2,483
AB	BCE.PR.B	7,688,739	7,688,739	6,989	768,873	1,747
AC	BCE.PR.C	10,027,991	10,027,991	3,598	1,002,799	1,000
AD	BCE.PR.D	9,963,209	9,963,209	5,255	996,320	1,313
AE	BCE.PR.E	6,512,913	6,512,913	5,004	651,291	1,251
AF	BCE.PR.F	9,481,487	9,481,487	5,397	948,148	1,349
AG	BCE.PR.G	8,979,530	8,979,530	5,276	897,953	1,319
AH	BCE.PR.H	5,017,570	5,017,570	2,961	501,757	1,000
AI	BCE.PR.I	9,535,040	9,535,040	3,983	953,504	1,000
AJ	BCE.PR.J	4,464,960	4,464,960	3,703	446,496	1,000
AK	BCE.PR.K	23,190,312	23,190,312	15,753	2,319,031	3,938
AL	BCE.PR.L	1,799,388	1,799,388	462	179,938	1,000
AM	BCE.PR.M	10,439,978	10,439,978	7,767	1,043,997	1,941
AN	BCE.PR.N	1,054,722	1,054,722	968	105,472	1,000
AQ	BCE.PR.Q	9,200,000	9,200,000	5,946	920,000	1,486
(1) As of November 2, 2022. (2) For the 6 months ended October 31, 2022. (3) Represents approximately 10% of the public float in respect of each series of Preferred Shares. (4) Represents the maximum number of shares of each series of Preferred Shares that may be purchased over the TSX (or alternative trading systems in Canada, if eligible) during the course of one trading day. This amount is equal to the greater of (i) 25% of the average daily trading volume on the TSX calculated in accordance with the rules of the TSX, and (ii) 1,000 shares. This limitation does not apply to purchases made pursuant to block purchase exemptions.

BCE is making this NCIB because it believes that, from time to time, the Preferred Shares may trade in price ranges that do not fully reflect their value. BCE believes that, in such circumstances, the repurchase of its Preferred Shares represents an appropriate use of its available funds.

As of November 2, 2022, under its current normal course issuer bid that commenced on November 9, 2021 and will expire on November 8, 2022, and for which the company received approval from the TSX, BCE did not purchase any Preferred Shares.

BCE will enter into an automatic securities purchase plan (“ASPP”) with a designated broker in relation to the NCIB on or about the commencement date of the NCIB. The ASPP will allow for the purchase of Preferred Shares, subject to certain trading parameters, at times when BCE ordinarily would not be active in the market due to applicable regulatory restrictions or self-imposed trading black-out periods. Outside of these periods, the Preferred Shares will be repurchased by BCE at its discretion under the NCIB.

I normally don’t report these announcements because they normally don’t mean anything. But:

According to the 2022 Annual Report:

Normal course issuer bid for BCE First Preferred Shares

On November 3, 2022, BCE announced the renewal of its NCIB to purchase for cancellation up to 10% of the public float of each series of BCE’s outstanding First Preferred Shares that are listed on the Toronto Stock Exchange. The NCIB will extend up to November 8, 2023, or an earlier date should BCE complete its purchases under the NCIB.

In 2022, BCE repurchased and canceled 584,300 First Preferred Shares with a stated capital of $15 million for a total cost of $10 million. The remaining $5 million was recorded to contributed surplus.

Subsequent to year end, BCE repurchased and canceled 1,090,400 First Preferred Shares with a stated capital of $27 million for a total cost of $20 million. The remaining $7 million was recorded to contributed surplus

… and according to the 23Q2 Quarterly Report:

Normal course issuer bid for BCE First Preferred Shares

For the three and six months ended June 30, 2023, BCE repurchased and canceled 1,848,950 and 3,560,950 First Preferred Shares with a stated capital of $46 million and $89 million for a total cost of $32 million and $63 million, respectively. The remaining $14 million and $26 million were recorded to contributed surplus for the three and six months ended June 30, 2023, respectively.

The 23Q3 Quarterly Report will be released 2023-11-2.

A poster on Financial Wisdom Forum, Thurman, has compiled the following numbers of the purchases to date (from a compilation of SEDI data), which I have not checked myself and present ‘as is’:

Symbol — Shares — Ave Price — Value
————————————————————
BCE.PR.A — 572,200 — $17.32 — $9,910,708.22
BCE.PR.B — 512,800 — $18.07 — $9,266,588.32
BCE.PR.C — 140,400 — $17.62 — $2,473,157.89
BCE.PR.D — 379,800 — $18.14 — $6,889,956.77
BCE.PR.E — 402,600 — $18.26 — $7,351,276.91
BCE.PR.F — 318,500 — $16.11 — $5,130,032.47
BCE.PR.G — 329,600 — $15.22 — $5,015,858.45
BCE.PR.H — 131,100 — $18.14 — $2,378,615.73
BCE.PR.I — 163,500 — $15.22 — $2,488,032.64
BCE.PR.J — 181,900 — $18.25 — $3,319,493.14
BCE.PR.K — 687,600 — $14.26 — $9,801,749.70
BCE.PR.L — 35,100 — $16.29 — $571,917.03
BCE.PR.M — 174,500 — $14.76 — $2,576,196.17
BCE.PR.N — 11,700 — $17.21 — $201,380.98
BCE.PR.Q — 638,200 — $20.73 — $13,231,363.82
BCE.PR.R — 98,200 — $14.82 — $1,455,565.46
BCE.PR.S — 59,400 — $18.11 — $1,075,488.32
BCE.PR.T — 452,600 — $18.16 — $8,221,445.70
BCE.PR.Y — 241,500 — $18.01 — $4,349,190.73
BCE.PR.Z — 191,850 — $19.11 — $3,666,577.96

Grand Total — 5,723,050 — $17.36 — $99,374,596.41