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Preferred Share Description
Bank of Montreal (BMO.PR.Y)
3.80% Non-Cumulative, Redeemable, Rate Reset, Class B, NVCC* Preferred Shares, Series 33
Prospectus - May 29, 2015
Maketing Summary - May 27, 2015
DBRS Credit Rating: June 22, 2018 - DBRS confirmed the ratings of Bank of Montreal and its related entities, including BMO’s Long-Term Issuer Rating at AA and Short-Term Issuer Rating at R-1 (high). BMO’s Long-Term Issuer Rating is composed of an Intrinsic Assessment (IA) of AA (low) and a Support Assessment (SA) of SA2, reflecting the expectation of timely, systemic support from the Government of Canada (rated AAA with a Stable trend by DBRS). The SA2 designation results in a one-notch benefit to the Long-Term Issuer Rating. The trend on all ratings is Stable, reflecting the finalization of the Canadian Bank Recapitalization Regime (the Bail-In Regime) and DBRS’s view that a sufficient level of bail-inable senior debt will provide an adequate buffer for non-bail-inable obligations, which will offset the expected removal of systemic support.
Important Note: NVCC preferred shares have a lower credit rating than other BMO preferred share issues. DBRS assigned the NVCC Preferred Shares Series 33 a rating equal to the Bank’s intrinsic assessment less four rating notches because the Series 33 has only an Office of the Superintendent of Financial Institutions (OSFI)-compliant non-viable contingent capital (NVCC) trigger, which is consistent with the OSFI requirements for NVCC instruments, and no additional triggers.
*NVCC is short for Non-Viability Contingent Capital and it refers to the issuer's ability to convert the preferred shares into common shares if a "Trigger Event" occurs. See "Convertible by Company" section below for the definition of a trigger event.
- DBRS Rating
- Pfd-2 Stable Trend
- DBRS Rating Date
- Shares Issued
- Issued Date
- Shares O/S
- O/S Date
- $0.95 per share per year
- Dividend Dates
- Payable on the 25th day of February, May, August and November
- Dividend Details
- Initially the dividend is set at a fixed annual rate of 3.80% until August 25, 2020. The dividend rate will be reset on August 25, 2020 and on August 25th every five years thereafter. The dividend rate will be set at an annual rate equal to the Government of Canada Yield (GCAN5YR) plus 2.71%.
- The shares will not be redeemable by the company prior to August 25, 2020. Redeemable at the company's option on August 25, 2020 and on August 25 every five years thereafter, at $25.00 per share plus all declared and unpaid dividends.
- Holders of the Series 33 have the right to convert their shares into an equal number of Series 34 Floating-Rate preferred shares on August 25, 2020 and on August 25th every five years thereafter. The Floating Rate Class B shares will calculate and pay dividends quarterly. The floating-rate dividend will equal the 3-month Government of Canada Treasury Bill yield plus 2.71%. On August 25, 2025 and on August 25th every five years thereafter Series 34 shareholders have the right to convert back into Series 33 rate-reset preferred shares.
- Transfer Agent
- Computershare Trust Company of Canada
- Computershare Trust Company of Canada
- Dividend Reinvestment Plan
- Holders of this series of BMO preferred shares may be eligible for the DRIP, where preferred share dividends can be reinvested into common shares of BMO. Check with the financial institution that administers your account.
- Convertible by Company
- Upon the occurrence of a Trigger Event (as defined in the prospectus), each outstanding Preferred Share Series 33 and, if issued, each outstanding Preferred Share Series 34 will automatically and immediately be converted, without the consent of the holders thereof, into that number of Common Shares of the Bank determined by dividing $25.00 plus any declared but unpaid dividends in respect of such Preferred Share Series 33 or Preferred Share Series 34 by the Conversion Price. The term “Trigger Event” has the meaning as set by the Office of the Superintendent of Financial Institutions Canada, Guideline for Capital Adequacy Requirements, Chapter 2 - Definition of Capital dated December 2014, as such term may be amended or superseded by OSFI from time to time.
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