# New 4.95% National Bank Preferred Share Announced



## InvestingForMe (Sep 6, 2012)

National Bank just announced a new preferred share issue: Its a 4.95% Non-Cumulative, Redeemable, NVCC*, Rate Reset, 1st preferred shares, Series 42.

In BC, that's an Interest Rate Equivalent of 6.60%


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## agent99 (Sep 11, 2013)

InvestingForMe said:


> National Bank just announced a new preferred share issue: Its a 4.95% Non-Cumulative, Redeemable, NVCC*, Rate Reset, 1st preferred shares, Series 42.
> 
> In BC, that's an Interest Rate Equivalent of 6.60%


Just read the conversion details. And I thought preferreds were more secure than common shares?? Is this a common feature of pfds? Looks like pfds provide a steady flow of income, no growth and share price is dependent on interest rates. Then if company runs into trouble, your shares can be converted into common shares which at that stage will have tanked in value and will likely no longer be paying a dividend?



> Contingent Conversion: If a "Trigger Event" (as defined below) were to occur, all of the then outstanding Preferred Shares Series 42 and 43 will be automatically exchanged, without the consent of the holders, for newly issued fully-paid and freely-tradable common shares of the Bank (the “Common Shares”), the number of which to be determined in accordance with the Contingent Conversion Formula; rounding down, if necessary, to the nearest whole number of Common Shares, such conversion being referred to herein as the “Contingent Conversion”


Should buyers be concerned?

I own two perpetual pfds. I guess I should go read the prospectuses again!


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## like_to_retire (Oct 9, 2016)

agent99 said:


> Just read the conversion details. And I thought preferreds were more secure than common shares?? Is this a common feature of pfds? Looks like pfds provide a steady flow of income, no growth and share price is dependent on interest rates. Then if company runs into trouble, your shares can be converted into common shares which at that stage will have tanked in value and will likely no longer be paying a dividend?
> 
> Should buyers be concerned?
> 
> I own two perpetual pfds. I guess I should go read the prospectuses again!


NVCC compliance has been going on since 2013. It started in 2011 (after the banking crisis of 2008) with an OSFI document outlining the Canadian implementation of the new international banking standards for non-common equity components of Tier 1 Capital.

You should read James Hymas BLOG if you own prefs and you should buy a few PrefLetters from James and find out about this rather than me trying to explain it.

Safe to say I don't buy bank prefs.

ltr


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## agent99 (Sep 11, 2013)

like_to_retire said:


> NVCC compliance has been going on since 2013. It started in 2011 (after the banking crisis of 2008) with an OSFI document outlining the Canadian implementation of the new international banking standards for non-common equity components of Tier 1 Capital.
> 
> You should read James Hymas BLOG if you own prefs and you should buy a few PrefLetters from James and find out about this rather than me trying to explain it.
> 
> ...


Thanks ltr. I recall reading about NVCC and why some financial pfds would be called early. But not owning any bank or financial pfds, I never paid much attention! I just went and read a bit about NVCC and now have slightly better understanding, I hope!


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## like_to_retire (Oct 9, 2016)

agent99 said:


> Thanks ltr. I recall reading about NVCC and why some financial pfds would be called early. But not owning any bank or financial pfds, I never paid much attention! I just went and read a bit about NVCC and now have slightly better understanding, I hope!


Also be aware that as of today it doesn't apply to insurance prefs, but it has a large influence on their pricing since it has been long intimated that it may well eventually apply to insurance products as it's recognized there is a tendency towards harmonization of the capital requirements wherever possible. Many believe that insurance prefs could be called as a result if this occurs (at $25 of course, along with a nice capital gain for the owner) and so it affects pricing, or at least evaluation of YTM.

ltr


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## OnlyMyOpinion (Sep 1, 2013)

Thanks. Leave it to LTR to provide a response and explanation.

George (InvestingForMe) on the other hand, just posts new issues on CMF as click bait, to try to draw people to his website where he can profit from you. Too bad as he has some helpful experience.


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## AltaRed (Jun 8, 2009)

Agree. Unabashed spam, i.e. soliciting for one's own website.


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## InvestingForMe (Sep 6, 2012)

I must apologize to forum members. I incorrectly assumed information about preferred shares would be of interest to you and it would lead to a better understand of these types of investments. I was obviously wrong.

When I do my posts, I use links to the pages on my website for convenience - Like most I don't have a lot of time and I don't see the point in retyping it all twice. I apologize for my laziness.

Just for greater clarity, AltaRed and OnlyMyOpinion my website averages over 40,000 visitors each month and less than 70 of those visitors ever originate from this forum. I can assure you, posting to Canadian Money Forum is not a money motivated activity as you both suggest.


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## OnlyMyOpinion (Sep 1, 2013)

Thanks for the explantion IFM. 
A nod to James Hymas' site is of greater value to those interested in prefs (none of those irritating ads either).
Glad to hear your site is doing so well commercially and doesn't really need the 70 CMF visitors. 
I guess that means its 'hasta la vista' time.


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## AltaRed (Jun 8, 2009)

Prefblog is the real go-to source on prefs from someone (James Hymas) with a credible track record in prefs.


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## carson (Apr 28, 2011)

Tough crowd in here...


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## james4beach (Nov 15, 2012)

I removed the hyperlinks in the original post, because they seem to be an attempt to promote the person's web site. The remaining content is, I presume, useful even without the links.


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## humble_pie (Jun 7, 2009)

james4beach said:


> I removed the hyperlinks in the original post, because they seem to be an attempt to promote the person's web site. The remaining content is, I presume, useful even without the links.




jas4 is this not somewhat inconsistent on your part

it appears you have also expunged this OP's link to his own blogspot on his cmf forum home page. However, do the rules not say that cmffers are prohibited from promoting their own products or websites in both posts & signatures, but they may offer their own website link on their home page?

the comical thing is that many cmffers do post self-advertising links in their signatures. The rules say No but they do it anyhow. No one has ever seen a moderator say Boo about this practice.

in fact some ambitious website owners even post messages in cmf threads saying they have already written with authority on such-&-such a topic. They include their link(s) so that cmffers seeking enlightenent can follow the link to benefit from their wisdom. The moderators never say Boo.


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## AltaRed (Jun 8, 2009)

carson said:


> Tough crowd in here...


As it should be. Moderators seem to be sparse and they appear to need help. Either rules be rigorously followed and enforced, or don't bother having rules in the first place.


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## humble_pie (Jun 7, 2009)

AltaRed said:


> As it should be. Moderators seem to be sparse and they appear to need help. Either rules be rigorously followed and enforced, or don't bother having rules in the first place.



does that mean zero self-advertising commercial signatures then

some cmffers wlll be crushed ...

me i think forum should be consistent. Either no commercial links in signatures or else everybody can have em & take down the rule


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## AltaRed (Jun 8, 2009)

The owner(s) of a forum sets the rules. I am just saying... apply and enforce the rules (whatever they are) evenly and consistently, or change/eliminate the rule. If the rule is that a link to one's website can be provided in the signature, then so be it and let them be, and then keep self-promotion links to one's website out of posts at the risk of banning. That kind of rule is not difficult to understand.


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## james4beach (Nov 15, 2012)

Here are the forum rules:
http://www.canadianmoneyforum.com/announcement.php?f=3

Spam is not allowed, and you can't promote a company or service in a thread or signature. Spam is often a judgement call by the moderators. In some cases it's very clear spam, in others (like this) it's a bit more of a grey area.

I didn't have time, but another thing I would do is look back at the poster's history and see what other content they have posted. If it mostly included links to their service, I'd ban them for spam. If however they were routinely participating in normal discussions or contributing positively in general, I'd usually overlook something like this thread.


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## humble_pie (Jun 7, 2009)

AltaRed said:


> The owner(s) of a forum sets the rules. I am just saying... apply and enforce the rules (whatever they are) evenly and consistently, or change/eliminate the rule. If the rule is that a link to one's website can be provided in the signature, then so be it and let them be, and then keep self-promotion links to one's website out of posts at the risk of banning. That kind of rule is not difficult to understand.




the rules themselves clearly state that links to personal/commercial websites may not be included in signatures, neither may they be included in posts

the rules say nothing about links on a member's home page so i've always assumed it's fine to place links on home page

the actual reality practice has always been very different. Personal links are included in signatures which air thousands of times, every time a member posts. Some members also post messages stating that they have authored definitive texts on a particular issue on their personal websites - which is perhaps what this OP likes to do - and there are a few members who overdo this practice.

most comical of all is the fact that founders CC & FT - who after all made up the rules about no-links-in-signatures - always had links to their own personal websites in their signatures. These links would have appeared thousands of times. Oh, the irony of it all!


me i believe altaRed is quite right when he says either No Links or else All Links in signatures; but the rules should apply evenly across the board. Not favouring some members while punishing other members for the same behaviour.


not that my own views matter in the least, but i'm in favour of personal/commercial links being encouraged on all home pages. Of course members should be allowed an opportunity to show & tell about their products, services, hobbies & other interests. Other members often find these products & services to be very helpful.

i'd also be in favour of personal/commercial links in all signatures. This means they would appear every time a member posts. Yes there have been a few members who conspicuously post "i agree" messages, which if repeated often enough tend to look as if such member is simply seeking another opportunity to post his advertising. But i believe the forum can live with this. In the end, such behaviour only serves to make such member look like a bit of a hustler.

it goes without saying that signatures should be kept as simple & small as they are now. Only a few characters. Everything in plain text. No graphics. Nothing that looks like an ad. 


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## lonewolf :) (Sep 13, 2016)

IFM could you please private message me link to your website Thank you


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## OnlyMyOpinion (Sep 1, 2013)

lonewolf :) said:


> IFM could you please private message me link to your website Thank you


Lonewolf, I may have chased IFM away. But you only need to search "investing for me" in Google and the first result will be a link to his website. 

George may well have information of interest to people on his website, but it is a commercial endeavour and his recent posts on CMF were clearly intened to steer people to his site. His short, initial post starting this thread actually managed to provide 2 links to his site. 

I would be less critical of a member who added to the forum with comments and contributions. We have a few folks like that and it is very clear from their participation and engagement that steering folks to their site is not their primary purpose when they post. That is just not the case with this thread and post.


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## humble_pie (Jun 7, 2009)

OnlyMyOpinion said:


> I would be less critical of a member who added to the forum with comments and contributions. We have a few folks like that and it is very clear from their participation and engagement that steering folks to their site is not their primary purpose when they post. That is just not the case with this thread and post.



the thing is, the above is a highly subjective judgment about whether someone else's body of posts is worthwhile enough that the author has "earned" the right to keep posting with his signature; while - subjectively speaking - another person's posts have not earned that right.

you might notice that jas4 has a variation of the same argument. He says he tries to look at post history & subjectively decide if he thinks a poster who uses personal links aggressively in signatures has "earned" his - james4's - approval.

me i think the above subjective approach is unfair. What might look like nicely "earned" posts with signatures to one person might look like banal trivia with self-advertising signatures to another person.

that's why i for one believe that anybody who wants to mention his product or service in a signature should be able to do so. Not just the mysterious few who somehow receive the blessing of the CMF authorities that decide who gets to advertise in signatures vs who gets expunged. Even though no one is able to see or understand the criteria.

signatures are minimal low-key structures. Only a few characters, plain text, no graphics. They don't look like ads. In no way are they offensive.

if everyone who wishes to mention their personal/commercial website or product in a signature could do so, then it would be up to the sharp eyes like yourself to notice who - in your opinion - is stepping over the line too frequently.

me i think abolishing the signature rule & letting everyone who wants to advertise his product in his signature do so, would be far more democratic. Right now we have some signatures "liked" by jas4beach or "liked" by onlyMO who can post their self-advertising freely. We have others like the OP here who was perhaps treated a little too harshly. Let's make the rules even-handed & transparent for everyone.


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## james4beach (Nov 15, 2012)

But there's more to it. One spamming approach (and I mean actual spamming here) is to write seemingly legitimate posts, but sprinkle hyperlinks within the text. The dumb robot ones are easy to catch since the posts are meaningless garbage. Other spamming operations hire people in third world countries to write simplistic posts. This helps search engines pick up the addresses and boosts the ranking of the web site. This technique is outright spamming, and we ban people whenever we detect this.

More sophisticated versions of spamming may involve writing quite involved posts and actually "participating" while occasionally posting links, for commercial purposes.

I have given IFM a short temporary ban to get their attention and remind them to not post links to commercial sites. If they want to keep participating on the site, they're welcome to.

And yes, long time, well established members definitely have more leeway in any grey area, versus someone with just 56 posts who has frequently posted self-promoting links.


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## humble_pie (Jun 7, 2009)

james4beach said:


> But there's more to it. One spamming approach (and I mean actual spamming here) is to write seemingly legitimate posts, but sprinkle hyperlinks within the text. The dumb robot ones are easy to catch since the posts are meaningless garbage. Other spamming operations hire people in third world countries to write simplistic posts. This helps search engines pick up the addresses and boosts the ranking of the web site. This technique is outright spamming, and we ban people whenever we detect this.
> 
> I have informed IFM by private message that they may not post links to commercial sites or services. So far, they have posted multiple messages that promote their commercial site.



i was never discussing anything about spamming posts or spam links within any actual post. Against those, i believe cmf forum should maintain a draconian opposition.

i was only discussing signatures. Nothing more. 

signatures are visually minimal. A few characters. Plain text. No graphics. A poster only has one signature per post. I don't see why every cmffer should not be allowed to mention their product, service, website or hobby in a harmless signature.

mine is a compromise middle-of-the-road approach. It would allow the forum to crack down even harder on spam posts, hyperlinks within posts, etc. But it would allow an outlet to many cmffers who have genuinely valuable products to offer.

btw i did glance at the OP's post history, just as you did. It's true that his recent posts have all been clickbait. But earlier he has at least some posts of merit. IMHO it's a grey zone ...

one way to prevent all this dickering would be to allow every cmffer to include their own stuff in their signatures if they wish .each:





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## OnlyMyOpinion (Sep 1, 2013)

humble_pie said:


> ... i think abolishing the signature rule & letting everyone who wants to advertise his product in his signature do so, would be far more democratic. Right now we have some signatures "liked" by jas4beach or "liked" by onlyMO who can post their self-advertising freely. We have others like the OP here who was perhaps treated a little too harshly. Let's make the rules even-handed & transparent for everyone.


Humble, as I noted earlier, 2 links were provided within the text of the OP's original post (not their signature) which took you to their website. The thread was created for the sole purpose of linking to their site - no discussion, no questions, etc. 

As far as I know, links within a post are intended to reference the source of quotes or of the subject being discussed. There are occasions when an individual's web or blog site does get referenced and linked within the context of that discussion. Starting a new thread for a share issue simply to provide two embedded links to your website doesn't fit IMO.
I think James' was correct to remove them.

I have no issue with signatures that act as a link to your website or blog.

I also didn't suggest IFM should be blocked or banned, indeed they are knowledgeable and I'm sure could contribute to CMF. As they said however, they are busy, and perhaps they don't have time the rattle on as we do.


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## james4beach (Nov 15, 2012)

I banned them (temporarily) because they had disabled private messages, and I couldn't get a warning message to them. The ban will get their attention and show the reason next time they try to log in.

Embedding commercial links inside the body is spammy kind of behavior and if I had seen any of these posts before, I would have warned them long ago.


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## humble_pie (Jun 7, 2009)

OnlyMyOpinion said:


> I have no issue with signatures that act as a link to your website or blog



my only issue was signatures. It's a micro issue. A nano issue.

i'd noticed that the OP's signature had been scrubbed, even from his home page. So i pointed out that "the rules" prohibit mention of personal product in signatures. Yet many do it. Many have always done it. Even the founders of cmf forum broke their own rule by always linking to their personal websites in their signatures.

i suggested that this rule be removed, since it's not being followed anyhow. Signatures should officially be free to name personal product, i dared to say. Cmffers could happily use them as tiny little ads if they wished, i ventured.

then the rule against spamming or hyperlinking in the text of a post itself could be enforced even more strictly, i thought.

as for what has happened to this particular OP, me i'm totally happy with whatever jas4 has done. If the poster had to be banned because disabled pmmms, so be it. I just thought he should be able to keep his signature on his home page & as an accompaniment to his individual posts. Was that too much to suggest?


(signed)
signature scone


.


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## AltaRed (Jun 8, 2009)

Like HP, I don't have a problem with 1-2 links in the signature line... I rarely look at signature lines and when I do, I typically would not click through to links. It is links to one's own website in a post that I feel is blatant solicitation and disruptive. I expect links in posts to be to authoritative arm's length sources to support the assertion in the post.


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## lonewolf :) (Sep 13, 2016)

When I clicked on the 2 links IMF provided I did not even realize I was clicking on his site. The first link seamed to lead one straight to the info regarding the preferred share which was of interest. The second one was also of interest to a pretty neat calculator that took into account the rate of return & the how taxes effected the rate of return. The links for me provided interesting info I did not even realize they took one to the op web site.

IMF mentioned that he had something like 40,000 hits on his website. Not sure how many hits CMF has had though CMF should maybe consider working with IMF & if IMF provides a link to CMF they should work together providing links to each others website. Both sites deal with investment information so it should be easy to figure something out that is benefits the owners & the customers. As a customer of CMF the IMF link was a positive not a negative advertisement for me.


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