Scotiabank Tier 1 Trust has issued $650 million of Scotiabank Tier 1 Trust Securities – Series 2009-1 due June 30, 2108, Bank of Nova Scotia said Thursday.

The Scotia BaTS III Series 2009-1 are subordinated, unsecured debt obligations of the trust and will qualify as Tier 1 capital of Scotiabank for regulatory purposes.

The price of each Scotia BaTS III Series 2009-1 will be $1,000 and interest will be paid semi-annually in the amount of $39.01 per Scotia BaTS III Series 2009-1 on the last day of June and December until June 30, 2019. After June 30, 2019 and on every fifth anniversary thereafter until 2104, the interest rate on the Scotia BaTS III Series 2009-1 will be reset at an interest rate per annum equal to the then prevailing Government of Canada Yield plus 7.05%. The first interest payment will be made on June 30, 2009 in the amount of $11.54 per Scotia BaTS III Series 2009-1.

On or after June 30, 2014, the Trust may, at its option redeem the Scotia BaTS III Series 2009-1, in whole or in part, subject to the approval of the Superintendent of Financial Institutions of Canada.

In certain circumstances the Scotia BaTS III Series 2009-1 will be automatically exchanged for non-cumulative preferred shares of the bank. In addition, in certain circumstances, holders of Scotia BaTS III Series 2009-1 will be required to invest cash interest paid thereon in non-cumulative preferred shares of the bank.

This domestic public offering is part of Scotiabank’s ongoing and proactive management of its Tier 1 capital structure, the bank said.

IE