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Preferred Share Description
ECN Capital Corporation (ECN.PR.A) **New Issue**
6.50% Cumulative Minimum Rate-Reset Series A preferred shares
Prospectus - November 23, 2016
Marketing Sheet - November 23, 2016
Company Overview - October 2016
DBRS Credit Update: November 23, 2016 - DBRS has today assigned a rating of Pfd-3 (low) to the C$100 million Cumulative Five-Year Minimum Reset Preferred Shares, Series A issued by ECN Capital Corporation. The trend on the Preferred Shares is Stable. The proceeds from the Preferred Shares will be included in the general funds of ECN and available for general corporate purposes. The ratings of ECN reflect the Company’s solid franchise as a leading commercial lender and lessor in North America with strong origination platforms and sound risk management across multiple asset classes. The ratings also consider the solid earnings generation derived from the franchise, producing more than sufficient pre-provision earnings to absorb the cost of credit with a solid cushion to absorb potentially higher losses that would be expected through the cycle, as well as unexpected losses. Funding is appropriate and aligned with the asset base, while leverage is considered low compared to peers. The Company’s reliance on secured forms of wholesale funding and execution risks associated with the Company’s evolving strategy to become more “asset-lite”, as well as the potential for entry into new business activities currently constrain the ratings.
- DBRS Rating
- Pfd-3 (low) Stable Trend
- DBRS Rating Date
- Shares Issued
- Issued Date
- Shares O/S
- O/S Date
- $1.625 per share per year
- Dividend Dates
- Payable quarterly on the last day of March, June, September and December
- Dividend Details
- The dividend rate is fixed until December 31, 2021. On December 31, 2021 and on December 31st every 5-years thereafter, the dividend rate will be reset and fixed to equal to the 5-Year Government of Canada Bond Yield (“GCAN5YR”) plus 5.44%, provided that, in any event, the rate will not be less than 6.50%.
- The shares are not redeemable by the company prior to December 31, 2021. On December 31, 2021 and on December 31st every 5-years thereafter, the company can redeem the shares at $25.00 per share.
- On December 31, 2021 and on December 31 every five years thereafter, the holders of Series A Preferred Shares will have the option to convert any or all of their Series A Preferred Shares into an equal number of Cumulative Floating Rate Preferred Shares, Series B. The Series B Floating-rate shares will calculate and pay a dividend quarterly equal to sum of the 3-month Canadian Treasury Bill Rate plus 5.44%. In addition, on December 31, 2026 and on December 31st every five years thereafter, the holders of Floating-Rate, Series B Preferred Shares will have the option to convert any or all of their shares into an equal number of Cumulative 5-Year Minimum Rate Reset Preferred Shares Series A. The Floating-Rate Series B shares are redeemable on December 31, 2026 and on December 31st every 5-years thereafter at $25.00 per share. On any other date that is not a Series B Redemption Date after December 31, 2021, the Corporation may redeem the Floating-Rate Series B Preferred Shares in whole or in part by the payment of $25.50 for each share to be redeemed.
- Lead Underwriter(s)
- BMO Capital Markets, CIBC Capital Markets, National Bank Financial, RBC Capital Markets, and TD Securities
- Dividend Reinvestment Plan
- Not available to preferred shareholders
- Last Updated