{"id":10284,"date":"2010-03-29T12:22:32","date_gmt":"2010-03-29T16:22:32","guid":{"rendered":"http:\/\/www.prefblog.com\/?p=10284"},"modified":"2010-03-29T12:22:32","modified_gmt":"2010-03-29T16:22:32","slug":"new-issue-bns-fixedreset-3-85100","status":"publish","type":"post","link":"https:\/\/prefblog.com\/?p=10284","title":{"rendered":"New Issue: BNS FixedReset 3.85%+100"},"content":{"rendered":"

The Bank of Nova Scotia has announced<\/a>:<\/p>\n

a domestic public offering of 10 million non-cumulative 3.85% 5-year rate reset preferred shares Series 30 (the “Preferred Shares Series 30”) at a price of $25.00 per share, for gross proceeds of $250 million.<\/p>\n

Holders of Preferred Shares Series 30 will be entitled to receive a non-cumulative quarterly fixed dividend for the initial period ending April 25, 2015 yielding 3.85% per annum, as and when declared by the Board of Directors of Scotiabank. Thereafter, the dividend rate will reset every five years at a rate equal to 1.00% over the 5-year Government of Canada bond yield. Holders of Preferred Shares Series 30 will, subject to certain conditions, have the right to convert all or any part of their shares to non-cumulative floating rate preferred shares Series 31 (the “Preferred Shares Series 31”) of Scotiabank on April 26, 2015 and on April 26 every five years thereafter.<\/p>\n

Holders of the Preferred Shares Series 31 will be entitled to receive a non-cumulative quarterly floating dividend at a rate equal to the 3-month Government of Canada Treasury Bill yield plus 1.00%, as and when declared by the Board of Directors of Scotiabank. Holders of Preferred Shares Series 31 will, subject to certain conditions, have the right to convert all or any part of their shares to Preferred Shares Series 30 on April 26, 2020 and on April 26 every five years thereafter.<\/p>\n

The Bank has agreed to sell the Preferred Shares Series 30 to a syndicate of underwriters led by Scotia Capital Inc. on a bought deal basis. The Bank has granted to the underwriters an option to purchase up to an additional 2 million Preferred Shares Series 30 at closing, which option is exercisable by the underwriters any time up to 48 hours before closing.<\/p>\n

Closing is expected to occur on or after April 12, 2010. This domestic public offering is part of Scotiabank’s ongoing and proactive management of its Tier 1 capital structure.<\/p><\/blockquote>\n

Plus-100 is an awfully skinny spread against five-year Canadas and I suspect – basically for the first time, when it comes to bank FixedResets – that this really is intended to be perpetual money.<\/p>\n

It is somewhat amusing that BNS is the first bank in a long while to be offering FixedResets – their brokerage arm has been insisting that no such issuance is likely due to proposed Tier 1 rules – an assertion I never understood.<\/p>\n

Update<\/b>: Using the Break-Even Rate Shock Calculator<\/a> with values of 5.91% yield on BNS Straights and a 5-year term to reset, the Break-Even Rate Shock<\/a> for this issue is a stunning 318bp.<\/p>\n","protected":false},"excerpt":{"rendered":"

The Bank of Nova Scotia has announced: a domestic public offering of 10 million non-cumulative 3.85% 5-year rate reset preferred shares Series 30 (the “Preferred Shares Series 30”) at a price of $25.00 per share, …<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[17],"tags":[],"class_list":["post-10284","post","type-post","status-publish","format-standard","hentry","category-new-issues"],"_links":{"self":[{"href":"https:\/\/prefblog.com\/index.php?rest_route=\/wp\/v2\/posts\/10284","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/prefblog.com\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/prefblog.com\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/prefblog.com\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/prefblog.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=10284"}],"version-history":[{"count":0,"href":"https:\/\/prefblog.com\/index.php?rest_route=\/wp\/v2\/posts\/10284\/revisions"}],"wp:attachment":[{"href":"https:\/\/prefblog.com\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=10284"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/prefblog.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=10284"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/prefblog.com\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=10284"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}