TORONTO, Feb. 29,
2024 /CNW/ - Bank of Montreal (TSX: BMO) (NYSE: BMO) (or the
"Bank") today announced the pricing of USD $1.0 billion of non-viability contingent capital
("NVCC") Additional Tier 1 (AT1) Limited Recourse Capital Notes,
Series 4 (the "LRCNs").
The LRCNs will bear interest at a rate of 7.700 per cent
annually, payable quarterly, for the initial period ending, but
excluding, May 26, 2029. Thereafter,
the interest rate on the LRCNs will reset every five years at
a rate equal to the prevailing 5-year U.S. Treasury Rate plus 3.452
per cent. The LRCNs will mature on May 26,
2084. The expected closing date of the offering is
March 8, 2024.
Concurrently with the issuance of the LRCNs, the Bank will issue
NVCC Non-Cumulative 5-Year Fixed Rate Reset Class B Preferred
Shares, Series 53 ("Preferred Shares Series 53") to be held by
Computershare Trust Company of Canada, as trustee for BMO LRCN Trust (the
"Limited Recourse Trust"). In case of non-payment of interest on or
principal of the LRCNs when due, the recourse of each LRCN holder
will be limited to that holder's proportionate share of the Limited
Recourse Trust's assets, which will consist of Preferred Shares
Series 53 except in limited circumstances.
The LRCNs may be redeemed at the option of the Bank, with the
prior written approval of the Superintendent of Financial
Institutions (Canada), in whole or
in part, on not less than 10 nor more than 60 days' prior notice,
every quarter on the interest payment date, commencing on
May 26, 2029.
Net proceeds from this transaction will be contributed to the
general funds of the Bank and will qualify as Additional Tier 1
capital of the Bank for regulatory purposes.
BMO Capital Markets Corp., Goldman Sachs & Co. LLC, Morgan
Stanley & Co. LLC, Barclays Capital Inc., BNP Paribas
Securities Corp. and Credit Agricole Securities (USA) Inc. are the joint book-running managers
for the offering.
A registration statement relating to the offering has been filed
with the U.S. Securities and Exchange Commission (the "SEC") and is
effective. The offering is being made only by means of a prospectus
supplement and the accompanying prospectus that forms a part of the
registration statement. Copies of the preliminary prospectus
supplement and the accompanying prospectus for the offering may be
obtained free of charge by visiting EDGAR on the SEC's website at
www.sec.gov. Alternatively, copies of the final prospectus
supplement, when available, and the accompanying prospectus may
also be obtained by contacting BMO Capital Markets Corp. toll-free
at 1-866-864-7760; Goldman Sachs & Co. LLC toll-free at
1-866-471-2526; Morgan Stanley & Co. LLC toll-free at
1-866-718-1649; Barclays Capital Inc. toll-free at 1-888- 603-5847;
BNP Paribas Securities Corp. toll-free at 1-800-854-5674; and
Credit Agricole Securities (USA)
Inc. toll-free at 1-866 807-6030.
This press release does not constitute an offer to sell, or a
solicitation of an offer to buy, these securities in the United States or in any other jurisdiction
where such offer, solicitation or sale would be unlawful. The
offering may be made only by means of a prospectus supplement and
the accompanying prospectus.
About BMO Financial
Group
BMO Financial Group is the eighth largest bank in North America by assets, with total assets of
$1.3 trillion as of January 31, 2024. Serving customers for 200 years
and counting, BMO is a diverse team of highly engaged employees
providing a broad range of personal and commercial banking, wealth
management, global markets and investment banking products and
services to 13 million customers across Canada, the United
States, and in select markets globally. Driven by a single
purpose, to Boldly Grow the Good in business and life, BMO
is committed to driving positive change in the world, and making
progress for a thriving economy, sustainable future, and inclusive
society.
SOURCE BMO Financial Group