Bank of Montreal Sells $91 Million of Notes Tied to Stock Picks

Bank of Montreal sold $91 million more notes tied to a basket of 11 stocks chosen as this year’s “best picks” by Raymond James Financial Inc. (RJF)

The one-year securities, issued Jan. 15, yield the gains of the stocks or American depository shares of companies selected by the equity research team at Raymond James, according to a prospectus filed with the U.S. Securities and Exchange Commission. Raymond James distributed the notes to its network of more than 6,200 advisers for a 2.75 percent fee.

The bank issued $100 million of similar securities on Dec. 11, its largest offering in the U.S. last year, according to data compiled by Bloomberg. The total for the two sales is 16 percent more than the $165.3 million of securities that it issued tied to the 2012 Raymond James stock picks.

The companies that make up this year’s basket include Bed Bath & Beyond Inc. (BBBY), Jabil Circuit Inc. (JBL) and Tractor Supply Co. (TSCO)

Martha McInnis, a spokeswoman for the bank, declined to comment on the offering.

Banks create structured notes by packaging debt with derivatives to offer customized bets to retail investors while earning fees and raising money. Derivatives are contracts whose value is derived from stocks, bonds, commodities and currencies, or events such as changes in interest rates or the weather.

To contact the reporter on this story: Kevin Dugan in New York at kdugan4@bloomberg.net

To contact the editor responsible for this story: Alan Goldstein at agoldstein5@bloomberg.net

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