Royal Bank of Canada announces Institutional NVCC Preferred Share Issue

Royal Bank of Canada (TSX: RY) (NYSE: RY) today announced a domestic public offering of Non-Cumulative 5-Year Fixed Rate Reset First Preferred Shares, Series BU (“Preferred Shares Series BU”).

Royal Bank of Canada will issue to certain institutional investors 750 thousand Preferred Shares Series BU priced at $1,000 per share to raise gross proceeds of $750 million.

The Preferred Shares Series BU will yield 7.408 per cent annually, payable semi-annually, as and when declared by the Board of Directors of Royal Bank of Canada, for the initial period ending February 24, 2029. Thereafter, the dividend rate will reset every five years at a rate equal to 3.90 per cent over the 5-year Government of Canada bond yield.

Subject to regulatory approval, the bank may redeem the Preferred Shares Series BU in whole or in part at par, during the period from January 25, 2029 to and including February 24, 2029 and during the period from January 24 to and including February 24 every five years thereafter, on not less than 15 days and not more than 60 days’ notice.

RBC Capital Markets is acting as lead agent on the issue. The expected closing date is January 25, 2024. We routinely undertake funding transactions to maintain strong capital ratios and a cost effective capital structure. Net proceeds from this transaction will be used for general business purposes.

The Preferred Shares Series BU will be offered by way of a prospectus supplement to the bank’s short form base shelf prospectus dated March 25, 2022, to be filed on or about January 22, 2024 with the securities commissions and other similar regulatory authorities in each of the provinces and territories of Canada.

The Preferred Shares Series BU 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). 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.

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