Royal Bank Of Canada To Raise $750M Through Preferred Shares Series BU Offering
Portfolio Pulse from Benzinga Newsdesk
Royal Bank of Canada (RY) is issuing 750 thousand Preferred Shares Series BU at $1,000 each to raise $750 million. The shares will have an annual yield of 7.408%, payable semi-annually until February 24, 2029. Post that, the dividend rate will reset every five years to a rate 3.90% above the 5-year Government of Canada bond yield.
January 19, 2024 | 6:41 am
News sentiment analysis
Sort by:
Descending
POSITIVE IMPACT
RY is raising $750M through a Preferred Share offering. The offering could attract income-focused investors due to the high yield of 7.408%, which is attractive in the current low-interest-rate environment.
The issuance of Preferred Shares Series BU by RY is a significant move to raise capital. The high yield offered is likely to be attractive to investors, potentially leading to a positive short-term impact on the stock as it may be seen as a sign of strength and confidence in the bank's ability to pay dividends. However, the impact may be moderated by the fact that preferred shares typically do not have the same growth potential as common shares.
CONFIDENCE 90
IMPORTANCE 75
RELEVANCE 100