Bank of Nova Scotia (BNS:US) has issued $60.8 million of structured notes in the U.S. this year, already surpassing its total for all of 2011.
The bank has completed eight deals, compared with two offerings for $7 million last year, the lowest total of any issuer in the U.S., according to data compiled by Bloomberg.
The bank has increased sales even as the market drops. Total issuance in the U.S. fell 16 percent to $18.3 billion in the first five months of 2012, compared with the year-earlier period, Bloomberg data show.
Andrew Chornenky, a spokesman for the Toronto-based lender, declined to comment.
The bank is rated (BNS:US) Aa1 by Moody’s Investors Service, the second-highest investment grade, and AA- by Standard & Poor’s and Fitch Ratings, the fourth-highest. Only the Royal Bank of Canada, which has the highest credit rating of structured note issuers in the U.S., has a higher grade from Fitch.
On April 10, Scotiabank sold $27.3 million in 13-month notes tied to the Tokyo Stock Price Index, or Topix. The securities, issued April 10, yield the returns of the index, according to a prospectus filed with the Securities and Exchange Commission. The bank distributed the notes for a 0.25 percent fee.
Suntrust Banks Inc. (STI:US), which had the second-lowest sales last year, has issued $23.5 million of structured notes in 2012, more than the total for all of 2011, Bloomberg data show. The Atlanta-based bank sold $14.9 million of fixed-to-floating rate notes on March 13, its largest deal since at least the beginning of 2010, Bloomberg data show.
Structured notes are securities created by banks, which package debt with derivatives to offer customized bets to investors while earning fees and raising money. Derivatives are contracts whose value is derived from stocks, bonds, currencies and commodities.