Royal Bank of Canada announces Preferred Share Issue

/NOT FOR DISTRIBUTION TO U.S. NEWSWIRE SERVICES OR FOR DISSEMINATION IN THE UNITED STATES/

TORONTO, May 23, 2014 /CNW/ - Royal Bank of Canada (RY on TSX and NYSE) today announced a domestic public offering of $250 million of Non-Cumulative, 5-Year Rate Reset Preferred Shares Series BB.

Royal Bank of Canada will issue 10 million Preferred Shares Series BB priced at $25 per share and holders will be entitled to receive a non-cumulative quarterly fixed dividend for the initial period ending August 24, 2014 in the amount of $0.2190 per share, to yield 3.90 per cent annually. The bank has granted the Underwriters an option, exercisable in whole or in part, to purchase up to an additional 2 million Preferred Shares Series BB at the same offering price.

Subject to regulatory approval, on or after August 24, 2019, the bank may redeem the Preferred Shares Series BB in whole or in part at par. Thereafter, the dividend rate will reset every five years at a rate equal to 2.26 per cent over the 5-year Government of Canada bond yield. Holders of Preferred Shares Series BB will, subject to certain conditions, have the right to convert all or any part of their shares to Non-Cumulative Floating Rate Preferred Shares Series BC on August 24, 2019 and on August 24 every five years thereafter.

Holders of the Preferred Shares Series BC will be entitled to receive a non-cumulative quarterly floating dividend at a rate equal to the 3-month Government of Canada Treasury Bill yield plus 2.26 per cent. Holders of Preferred Shares Series BC will, subject to certain conditions, have the right to convert all or any part of their shares to Preferred Shares Series BB on August 24, 2024 and on August 24 every five years thereafter.

The offering will be underwritten by a syndicate led by RBC Capital Markets. The expected closing date is June 3, 2014.

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 BB 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) absent registration under the Securities Act or an applicable exemption from such registration requirements. 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.

SOURCE RBC

For further information:


Investor Contact:
Shirley Boudreau, Shareholder Relations, 416-955-7806, shirley.boudreau@rbc.com
Julia Macleod, Investor Relations, 416-955-7302, julia.macleod@rbc.com

Media Contact:
Sandra Nunes, Financial Communications, 416-974-1794, sandra.nunes@rbc.com