By Cristal Cody
Tupelo, Miss., Dec. 5 – Toronto-Dominion Bank announced on Friday that it priced C$300 million of non-cumulative five-year rate reset preferred shares with a 3.75% annual dividend for the initial period ending Jan. 31, 2020.
The bank sold 12 million shares of series 5 preferred stock (A3/P-2/DBRS: Pfd-2) at C$25.00 per share.
TD Securities Inc. was the lead manager.
The deal includes an over-allotment option of C$50 million, or 2 million shares.
The dividend rate will reset every five years at the five-year Government of Canada bond yield plus 225 basis points.
TD Bank may redeem the preferred stock in whole or in part at C$25.00 per share on Jan. 31, 2020 and on Jan. 31 of every following fifth year.
Subject to the bank’s redemption, series 5 preferred shareholders may convert their shares into series 6 non-cumulative floating-rate preferred shares on Jan. 31, 2020 and on every Jan. 31 of every fifth year thereafter. Series 6 preferred shareholders will receive floating-rate dividends equal to the three-month Government of Canada treasury bill yield plus 225 bps.
The Toronto-based bank and financial services company plans to use the proceeds from the offering for general corporate purposes.
| Issuer: | Toronto-Dominion Bank
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| Amount: | C$300 million, 12 million shares
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| Greenshoe: | C$50 million, 2 million shares
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| Maturity: | Jan. 31, 2020
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| Securities: | Non-cumulative five-year rate reset preferred shares
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| Bookrunner: | TD Securities Inc.
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| Dividend: | 3.75%; resets every five years at five-year Government of Canada bond yield plus 225 bps
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| Price: | C$25.00
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| Call feature: | Jan. 31, 2020 and on Jan. 31 of every fifth year thereafter at C$25.00 per share
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| Pricing date: | Dec. 5
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| Settlement date: | Dec. 16
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| Ratings: | Moody’s: A3
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| Standard & Poor’s: P-2
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| DBRS: Pfd-2
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| Distribution: | Canada
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