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Principal At Risk Notes
Bank of Montreal Covered Call Canadian High Dividend Callable Equity Income Principal At Risk Notes, Series 606 (CAD)
JHN6739
Product Details
TypeCallable Income
IssuerBank of Montreal
ClassEquity
Linked toBMO Canadian High Dividend Covered Call ETF [ZWC CT EQUITY]
CurrencyCAD
Issue DateJune 13, 2018
Maturity DateJune 13, 2025
Term7.0 Years
Contingent Coupon6.50% Per Annum
Payment FrequencySemi-Annual
Coupon Knock-Out-35.00%
Barrier Protection-35.00%
Autocall Level110.00%
Observation DatesSemi-Annual
Maximum Payment$145.50
Minimum Payment$1.00
Product Description
  • The Notes offer semi-annual coupon payments for investors while providing contingent protection against a slight to moderate decline in the unit price of the BMO Canadian High Dividend Covered Call ETF (the “Reference ETF”) over the term of the Notes. The Principal Amount is NOT protected under these Notes.
  • Issuer: Bank of Montreal.
  • Medium Term: 7-year term to maturity (subject to the Notes being automatically called by the Bank).
  • Reference ETF: The BMO Canadian High Dividend Covered Call ETF is designed to provide exposure to a dividend focused portfolio, while earning call option premiums. The underlying portfolio is yield-weighted and broadly diversified across sectors. The Reference ETF screens securities for dividend growth, sustainability and option liquidity. The Reference ETF also dynamically writes covered call options. The call options are written out of the money and selected based on analyzing the option’s available premium. The option premium provides limited downside protection. The units of the Reference ETF are listed for trading on the Exchange under the symbol “ZWC”.*
  • Contingent Semi-Annual Coupon Payments: Semi-annual Coupons equal to 3.25% (equivalent to 6.50% per annum), provided that the Closing Price of the units of the Reference ETF is equal to or above the Coupon Knock-Out Level (i.e., 65% of the Initial Price) on the applicable Observation Date. If the Closing Price of the units of the Reference ETF is below the Coupon Knock-Out Level on an Observation Date, then no Coupon will be payable to a Holder on the related Coupon Payment Date.
  • AutoCall Feature: The Notes will be automatically called by the Bank if the Closing Price of the units of the Reference ETF is equal to or above the AutoCall Level (i.e., 110% of the Initial Price) on any Observation Date. If the AutoCall feature is triggered, Holders will receive the Principal Amount plus the applicable Coupon on the corresponding Coupon Payment Date (in this case, the Call Date). If the Closing Price of the units of the Reference ETF is never equal to or above the AutoCall Level on any Observation Date, the Notes will not be automatically called by the Bank. If the Notes are automatically called by the Bank before Maturity, the Notes will be cancelled and Holders will not be entitled to receive any subsequent payments in respect of the Notes.
  • Contingent Protection: If the ETF Return is negative, the Principal Amount will be protected so long as the Final Price is equal to or above the Barrier Level (i.e., 65% of the Initial Price) on the Final Valuation Date. If the Final Price is below the Barrier Level on the Final Valuation Date, the Maturity Payment will be equal to the Principal Amount reduced by the ETF Return (which will be a negative amount equal to the decline in the unit price of the Reference ETF), subject to the Minimum Payment Amount. The calculation and timing of the payments at Maturity may be adjusted upon the occurrence of certain special circumstances.
  • Daily Secondary Market: Provided by BMO Capital Markets (may be subject to an early trading charge of up to 3.50% declining to zero over 180 days after the Issue Date and other limitations as described in the Prospectus).

Current Status
Update as ofMay 22, 2018
Remaining Term7.00 years
Current ETC
Current Bid Price historical $100.00