By Mary-Katherine Stinson and Cristal Cody
Lexington, Ky., April 24 – Canada (Aaa/AAA) priced $3 billion of 4.625% five-year bonds at 99.59 to yield 4.718%, or 10 basis points above Treasuries, on Tuesday, according to a final term sheet and a market source.
Initial talk on the five-year bonds was in the Treasuries plus 12 bps area, a source reported.
The Securities and Exchange Commission-registered deal constitutes a direct unconditional obligation of Canada. The payment of the principal of and interest on the bonds will be a charge on and be payable out of the Consolidated Revenue Fund of Canada.
The bonds are non-callable unless a change in Canadian laws or regulations would require the government to pay additional amounts on the bonds.
BMO Capital Markets Corp. (billing and delivery), BNP Paribas Securities Corp., BofA Securities, Inc., National Bank of Canada Financial Inc. and TD Securities (USA) LLC are the bookrunners.
Proceeds will be used to supplement and diversify Canada's liquid foreign reserves. The government of Canada is committed to maintaining liquid foreign reserves at or above 3% of nominal gross domestic product.
Settlement is planned for April 30.
The bonds will be listed on the Luxembourg Stock Exchange’s euro MTF market.
Canada last issued a U.S. dollar bond on April 19, 2023 totaling $4 billion.
| Issuer: | Canada
|
| Amount: | $3 billion
|
| Issue: | Bonds
|
| Maturity: | April 30, 2029
|
| Bookrunners: | BMO Capital Markets Corp. (billing and delivery), BNP Paribas Securities Corp., BofA Securities, Inc., National Bank of Canada Financial Inc. and TD Securities (USA) LLC
|
| Co-managers: | Barclays, Casgrain & Co. Ltd., CIBC World Markets Corp., Citigroup Global Markets Inc., Desjardins Securities Inc., Goldman Sachs International, HSBC Bank plc, J.P. Morgan Securities plc, Laurentian Bank Securities Inc., RBC Capital Markets LLC, Scotia Capital (USA) Inc. and Wells Fargo Securities LLC
|
| Coupon: | 4.625%
|
| Price: | 99.59
|
| Yield: | 4.718%
|
| Spread: | Treasuries plus 10 bps
|
| Call features: | Non-callable
|
| Trade date: | April 23
|
| Settlement date: | April 30
|
| Ratings: | Moody’s: Aaa
|
| S&P: AAA
|
| Distribution: | SEC registered
|
| Price talk: | Treasuries plus 12 bps area
|
| Cusip: | 43358BAA1
|
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