Bank of Montreal plans a domestic public offering of $200 million of preferred shares.

The net proceeds from the offering will be used by the bank for general corporate purposes, BMO says.

The Non-Cumulative 5-year Rate Reset Class B Preferred Shares Series 21 will be issued to the public at a price of $25 per share and holders will be entitled to receive non-cumulative preferential fixed quarterly dividends for an initial five years, payable in the amount of 40.625ยข a share, to yield 6.5% annually.

Thereafter, the dividend rate will reset every five years to be equal to the 5-Year Government of Canada Bond Yield plus 4.58%.

The anticipated closing date is March 20.

The offering will be underwritten on a bought deal basis by a syndicate led by BMO Capital Markets.

The bank has granted underwriters an option to purchase up to an additional $75 million of the Preferred Shares exercisable at any time up to two days before closing.

IE