PrefBlog

Brompton Funds has announced (on 2026-01-15):

Sustainable Power & Infrastructure Split Corp. (the “Fund”) today announced that it is proposing to change its name to “Power & Infrastructure Split Corp.” (the “Name Change”).

The Name Change is scheduled to take effect on January 19, 2026, subject to regulatory approval. The Fund invests in a globally diversified and actively managed portfolio (the “Portfolio”) consisting primarily of dividendpaying securities of power and infrastructure companies whose assets, products and services Brompton Funds Limited (“Brompton”), the Fund’s manager, believes are facilitating the multi-decade transition toward decarbonization and environmental sustainability.

The Fund’s class A shares (“Class A Shares”) offer a current distribution rate of 9.5% per annum.(1) Since inception, the Class A Shares have delivered a 13.8% per annum total return, outperforming the S&P Global Infrastructure Total Return Index by 3.7% per annum.(2)

The Fund’s preferred shares (“Preferred Shares”) offer a current distribution rate of 4.9% per annum.(1) The Preferred Shares have delivered a 5.1% per annum total return since inception. (2) Based on the most recently calculated net asset value per unit of the Fund on January 14, 2026, the Preferred Shares have downside protection from a decline in the value of the Fund’s portfolio of approximately 53.2%. The Preferred Shares have a Morningstar DBRS rating of Pfd-3.

The affected issue is PWI.PR.A.

Brompton Funds has announced:

Brompton Split Banc Corp. (the “Fund”) is pleased to announce its intention to complete a stock split of its class A shares (the “Share Split”) due to the Fund’s strong performance. Class A shareholders of record at the close of business on February 24, 2026 will receive 20 additional class A shares for every 100 class A shares held, pursuant to the Share Split. The Share Split is subject to the approval of the Toronto Stock Exchange (the “TSX”).

Class A shareholders will continue to receive regular monthly cash distributions targeted to be $0.10 per class A share following the Share Split. As a result, the total dollar amount of distributions to be paid to class A shareholders is expected to increase by approximately 20%. The Fund provides a distribution reinvestment plan, on a commission-free basis for class A shareholders that wish to reinvest distributions and realize the benefits of compound growth.

Over the last 10 years, the class A shares have delivered a 20.3% per annum total return based on net asset value, outperforming the S&P/TSX Equal Weight Diversified Banks Total Return Index by 5.6% per annum and the S&P/TSX Composite Total Return Index by 7.4% per annum.(1) Since inception, class A shareholders have received cash distributions of $23.85 per share.

Following the completion of the Share Split, the preferred shares of the Fund are expected to have downside protection from a decline in the value of the Fund’s portfolio of approximately 54%.(2)

The class A shares are expected to commence trading on an ex-split basis at the opening of trading on February 24, 2026. No fractional class A shares will be issued and the number of class A shares each holder shall receive will be rounded down to the nearest whole number. The Share Split is a non-taxable event.

The Fund invests on an approximately equally weighted basis in a portfolio (the “Portfolio”) of common shares of the six largest Canadian banks: Royal Bank of Canada, The Bank of Nova Scotia, National Bank of Canada, The Toronto-Dominion Bank, Canadian Imperial Bank of Commerce and Bank of Montreal. In addition, the Fund may hold up to 10% of the total assets of the Portfolio in investments in global financial companies for the purpose of enhanced diversification and return potential.

This follows the 117-new-for-100-old Capital Unit split announced last October.

Thanks to Assiduous Reader newbiepref for bringing this to my attention.

DBRS has announced that it:

downgraded its credit rating on the Preferred Shares (the Preferred Shares) issued by Canadian Large Cap Leaders Split Corp (the Company) to Pfd-3 from Pfd-3 (high). The rating downgrade reflects the completion of a stock split of the Class A Shares (Share Split), the upcoming increase in the monthly distribution rate on the Class A Shares to $0.18 per share from $0.125 per share, effective March 13, 2026, the decline in the dividend coverage ratio to 0.8 times (x), and a projected grind of 9.8% per year over the next five years. The maturity date of the Company is February 28, 2029. The term of the Company may be extended beyond the maturity date for additional terms of five years each as determined by the Company’s board of directors, provided that shareholders are given an optional special retraction right at the end of each successive term. Ninepoint Partners LP. (Manager) is acting as the manager for the Company.
…
In February 2026, the Company completed the Share Split. Class A shareholders of record at the close of business on February 6, 2026, received 20 additional Class A Shares for every 100 Class A Shares held. The Company also announced an increase in the monthly distribution rate on its Class A Shares to $0.18 per share from $0.125 per share, which will take effect with the distribution payable on March 13, 2026. Following the Share Split, the net asset value (NAV) per unit (one notional Unit: consists of one Preferred Share and one Class A Share) has decreased to $24.38 as of February 6, 2026 from $26.69 as of January 30, 2026.

The Preferred Shares are entitled to fixed cumulative preferential quarterly cash distributions of $0.1875 (or $0.75 annually) per share, representing a 7.5% per annum return on the issue price of $10.00. Beginning March 13, 2026, holders of the Class A Shares are expected to receive regular monthly noncumulative distributions targeted to be $0.18 per Class A Share. No monthly distributions to the Class A Shares will be made if (1) distributions to the Preferred Shares are in arrears or (2) in respect of a cash distribution, the Company’s NAV falls below 1.5 times (x) the principal amount of the outstanding Preferred Shares.

As of February 6, 2026, the downside protection available to holders of the Preferred Shares increased to 59.0% per Unit, up from 56.9% as of January 31, 2025. However, the dividend coverage ratio has continued to decline over the past three years to approximately 0.8x. The dividend coverage below 1.0x indicates that the current dividend income earned by the Company is not enough to fully cover the Company’s distributions on the Preferred Shares. Furthermore, the increase in the monthly distribution rate on the Class A Shares, is increasing the reliance on the Manager to generate a high yield to meet distributions without having to liquidate portfolio securities. To supplement the Portfolio income, the Company may engage in covered call option writing on all or a portion of the shares held in the Portfolio. Without giving consideration to capital appreciation potential or any source of income other than the dividends earned by the Portfolio, the Preferred Share distributions together with the targeted distributions on the Class A Shares will create a projected grind on the NAV of the Portfolio of approximately 9.8% per year over the next 5 years, up from the approximately 7.4% per year estimated a year ago.

Considering the level of downside protection, dividend coverage ratio below 1.0x, projected grind on the portfolio from expected distributions to the Class A Shares and the potential term extension, Morningstar DBRS downgraded the credit rating on the Preferred Shares issued by the Company to Pfd-3 from Pfd-3 (high).

NPS.PR.A is not tracked by HIMIPref™ as it is too small – less than 1.7-million shares outstanding according to the TMX. It’s website is HERE.