Annual Coupons
Annual Coupons per Note, if any, will be payable in Canadian dollars on the Annual Coupon Payment Date, in an amount, rounded to the nearest cent, equal to the result obtained using the following formula:
Annual Coupon Amount = $100.00 × Coupon Rate |
The Coupon Rate will be determined annually on the relevant Valuation Date. Generally stated, the Coupon Rate for each year until maturity will be a percentage amount equal to the simple average of the 10 Share Returns (one for each Share, each of which may be positive or negative).
The Share Return of a Share is the percentage increase or decrease in its Closing Price from the Issue Date to the applicable Valuation Date (the “Share Performance”), subject to the following:
- If the Share Performance is greater than zero, then the Share Return will be deemed to be 10% in all events (regardless of whether the actual positive Share Performance is less than or exceeds 10%); and
- If the Share Performance is zero or negative, then the Share Return will be the actual negative Share Performance, limited to -25%.
The maximum amount of interest that may be payable over the term of the Notes is $30.00 per Note (i.e., $10.00 in each year). Any Annual Coupon Amounts payable in respect of the Notes will not reflect any dividends declared on the Shares.
Performance Commentary
As at July 31, 2008 the performance of the BNS Canadian Equity Yield Seeker Deposit Notes, Series 1 on a NAV basis is
-5.87% since inception. Many Canadian equities have underperformed on account of the recent global economic downturn and slowing U.S. economy. However, the Canadian yield curve did rally during July increasing the value of the zero coupon component of the Notes.
Basket Performance
| Basket Assets |
Weight |
Initial Price
05/28/2008 |
Current Price
10/10/2008 |
Price Performance |
| Bank of Montreal |
7.14% |
$47.67 |
$37.25 |
-21.86% |
| Barrick Gold Corporation |
7.14% |
$40.34 |
$40.39 |
0.12% |
| Canadian Imperial Bank of Commerce |
7.14% |
$70.85 |
$50.50 |
-28.72% |
| Canadian Oil Sands Trust |
7.14% |
$51.21 |
$29.51 |
-42.37% |
| Canadian Pacific Railway Limited |
7.14% |
$73.34 |
$46.43 |
-36.69% |
| Encana Corporation |
7.14% |
$90.87 |
$49.89 |
-45.10% |
| Husky Energy Inc. |
7.14% |
$51.33 |
$31.98 |
-37.70% |
| Manitoba Telecom Services Inc. |
7.14% |
$41.66 |
$39.78 |
-4.51% |
| Research In Motion Limited |
7.14% |
$135.94 |
$67.65 |
-50.24% |
| Royal Bank of Canada |
7.14% |
$49.46 |
$41.40 |
-16.30% |
| Teck Cominco Limited |
7.14% |
$49.61 |
$19.10 |
-61.50% |
| Telus Corporation |
7.14% |
$47.82 |
$36.21 |
-24.28% |
| Thomson Corporation |
7.14% |
$36.58 |
$28.10 |
-23.18% |
| Yellow Pages Income Fund |
7.14% |
$10.03 |
$8.47 |
-15.55% |
| Overall Return |
|
|
|
-29.12% |
Note: An investment in principal protected notes may not be suitable for all investors. Important information about these investments is contained in the Information Statement of each note. Investors should obtain and carefully read a copy prior to investing, paying particular attention to the associated risks. Past performance is not indicative of future returns. Commissions, trailing commissions, management fees and expenses all may be associated with these investments. Principal is guaranteed at maturity only for products purchased at their issue price and held to maturity. The investment return on the notes, if any, is uncertain in that an investor may not receive more than return of the principal amount at maturity. A person should reach a decision to invest in the notes only after carefully considering with his or her advisor, the suitability of this investment in light of his or her investment objectives and the information set out in the respective Information Statement.
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