The National Bank of Canada (OTC:NTIOF) (TSX: NA) announced Thursday that it will not proceed with the conversion of its outstanding Series 42 Shares into Series 43 Shares on November 15, 2023. This decision comes after the bank received tenders for only 47,540 shares, falling significantly short of the one million shares required for conversion as per the prospectus supplement dated June 4, 2018.
These Series 42 Shares, traded on the Toronto Stock Exchange under the symbol NA.PR.G, will remain with their current shareholders. The bank confirmed that there will be no issuance of Series 43 Shares due to the insufficient number of tenders.
In addition to this announcement, the bank has also set a substantial annual dividend rate of 7.056% for these shares. This rate will be applicable for the upcoming five-year period from November 16, 2023, to November 15, 2028.
The National Bank of Canada is one of the leading financial institutions in the country and is part of an integrated financial group with various subsidiaries. With $426 billion in assets and approximately 30,000 employees in knowledge-intensive positions, it has gained recognition as a top employer committed to diversity.
InvestingPro Insights
In light of the recent developments at the National Bank of Canada, it's worth noting some key insights from InvestingPro. According to the InvestingPro data, the bank's market cap stands at a modest $70.8 million. Despite a negative P/E ratio of -2.36, the bank has demonstrated a commendable revenue growth of 65.16% over the last twelve months as of Q2 2023. However, a closer look reveals a quarterly revenue growth of -86.25% for Q2 2023, indicating a recent slowdown.
Turning to InvestingPro Tips, the bank has a history of maintaining consistent dividend payments, having raised its dividend for 13 consecutive years. This aligns well with the bank's recent announcement of a substantial annual dividend rate for its Series 42 Shares. However, it's important to note that analysts have revised their earnings downwards for the upcoming period, indicating potential challenges ahead.
To gain a comprehensive understanding of the bank's performance and potential, consider exploring the variety of additional tips available on InvestingPro. This includes insights into factors such as earnings quality, gross profit margins, and valuation metrics.
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