/NOT FOR DISTRIBUTION TO U.S. NEWSWIRE SERVICES OR FOR
DISSEMINATION IN THE UNITED
STATES/
TORONTO, July 21, 2020 /CNW/ - Royal Bank of Canada (TSX: RY) (NYSE: RY) today
announced the offering of $1.75
billion of non-viability contingent capital (NVCC)
Additional Tier 1 (AT1) Limited Recourse Capital Notes, Series 1
(the "LRCNs").
The LRCNs will bear interest at a rate of 4.50 per cent
annually, payable semi-annually, for the initial period ending
November 24, 2025. Thereafter, the
interest rate on the LRCNs will reset every five years at a rate
equal to the prevailing 5-year Government of Canada Yield plus
4.137 per cent. The LRCNs will mature on November 24, 2080. The expected closing date of
the offering is July 28, 2020. RBC
Capital Markets is acting as lead agent on the issue.
Concurrently with the issuance of the LRCNs, the bank will issue
NVCC Non-Cumulative 5-Year Fixed Rate Reset First Preferred Shares,
Series BQ ("Preferred Shares Series BQ") to be held by
Computershare Trust Company of Canada as trustee for a newly formed 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 BQ except in limited circumstances.
The bank may redeem the LRCNs during the period from
October 24 to and including
November 24, commencing in 2025 and
every five years thereafter, only upon the redemption by the bank
of the Preferred Shares Series BQ held in the Limited Recourse
Trust, in accordance with the terms of such shares and with the
prior written approval of the Superintendent of Financial
Institutions (Canada), in whole on
not less than 15 nor more than 60 days' prior notice.
Net proceeds from this transaction will be used for general
business purposes.
The LRCNs have not been, and will not be, registered in
the United States under the United
States Securities Act of 1933, as amended (the "Securities Act"),
or the securities laws of any state of the United States and may not be offered, sold
or delivered, directly or indirectly in the United States or to, or for the account or
benefit of, a "U.S. person" (as defined in Regulation S under the
Securities Act) absent registration under the Securities Act or an
applicable exemption from such registration requirements. This
press release does not constitute an offer to sell or a
solicitation to buy securities in the
United States or in any other jurisdiction where such offer
or solicitation would be unlawful.
SOURCE Royal Bank of Canada