Canada's CNSX Markets has launched a new segment for structured products after posting for trading BAC Canada Finance Company's five-year Extendible Step Up Semi-Annual Pay Medium-Term Notes, Series 1 on the Canadian National Stock Exchange (CNSX).
"We believe that this new product represents the start of an exciting new debt market in Canada," said Richard Carleton, interim CEO of CNSX Markets. "Issuers will be able to take advantage of the cost-effectiveness of the exchange's listings process and retail investors will be able to benefit from the transparency of the exchange's rules in trading these fixed-income-based products."
The issuer said it expects to raise $20m with the notes. The notes are unsecured and unsubordinated debt securities of BAC Canada Finance Company - formerly Merrill Lynch Canada Finance Company - and all amounts payable are guaranteed by Bank of America Corporation. The company will pay interest semi-annually during the term of the notes at an initial rate of 4.00% from and including 15 November 2011 to, but excluding 15 November 2012.
"This is the first structured product to list on CNSX," added William Woods, MD listed market. "Structured products markets are growing rapidly on stock exchanges in America and Europe and CNSX plans to be Canada's primary exchange for debt securities."
Stuart Investment Management Limited acted as agent on the offering of the notes and will provide a secondary market for the notes on the exchange.