By Cristal Cody
Tupelo, Miss., Oct. 25 – Royal Bank of Canada priced C$300 million of non-cumulative five-year rate reset preferred shares (Baa3/BBB//DBRS: Pfd-2) on Thursday with a 4.8% annual dividend for the initial period ending Feb. 24, 2024, according to a press release.
The bank sold 12 million shares of the series BO preferred stock at C$25.00 per share.
Royal Bank of Canada is offering a C$50 million, or 2 million share, over-allotment option.
RBC Capital Markets (Canada) Ltd. was the lead manager.
The bank may redeem the preferred shares on or after Feb. 24, 2024 at par.
The dividend rate will reset Feb. 24, 2024 and every five years at a rate equal to 238 basis points over the five-year Government of Canada bond yield.
Series BO preferred shareholders may convert their shares into series BP non-cumulative floating-rate preferred shares on Feb. 24, 2024 and on Feb. 24 every five years thereafter.
Series BP holders will be entitled to receive a non-cumulative quarterly floating dividend at a rate equal to the three-month Government of Canada treasury bill yield plus 238 bps.
Series BP preferred shareholders will have the right to convert their shares to series BO preferred shares on Feb. 24, 2029 and on Feb. 24 every five years thereafter.
Proceeds from the offering will be used for general business purposes.
Royal Bank of Canada is a Toronto-based financial services company.
| Issuer: | Royal Bank of Canada
|
| Amount: | C$300 million, 12 million shares
|
| Greenshoe: | C$50 million, 2 million shares
|
| Maturity: | Feb. 24, 2024
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| Securities: | Series BO non-cumulative five-year rate reset preferred shares
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| Bookrunner: | RBC Capital Markets (Canada) Ltd.
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| Dividend: | 4.8%; resets Feb. 24, 2024 and every five years at rate equal to 238 bps over five-year Government of Canada bond yield
|
| Price: | C$25.00 per share
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| Call feature: | On or after Feb. 24, 2024 at par
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| Pricing date: | Oct. 25
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| Settlement date: | Nov. 2
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| Ratings: | Moody’s: Baa3
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| S&P: BBB
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| DBRS: Pfd-2
|
| Distribution: | Canada, Regulation S
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