Bank of Nova Scotia sold Canada’s first defence bond as the country prepares for a rapid buildup in military spending. Scotiabank raised $750 million in a bond sale this week, and plans to use the proceeds to finance eligible assets, which can include general purpose loans to public or private entities in the defence and security sectors. The money can go toward a variety of sectors such as energy infrastructure, critical minerals , artificial intelligence and advanced semiconductors, according to a framework published by the bank. But “activities are eligible only if they support defence, security and resilience objectives.” It’s the first defence-labelled bond in the Canadian market, Scotiabank said. Future issuance of similar bonds will depend on Scotiabank’s funding needs and Canada’s evolving security priorities, Fanny Doucet, the bank’s head of sustainable finance, said in a statement. The bond sale drew 51 investors who put in orders more than twice the size of the bond, according to people familiar with the matter, who asked not to be identified as they aren’t authorized to speak publicly. Risk of U.S. midterm ‘blue wave’ leaves defence stocks out of favourMost of G7 is spending more on interest than defence, Scope says Scotia targeted the same investor base for the defense bond as it did for its regular senior bail-in bonds, Doucet said. A French bank sold Europe’s first defense bond last August. Bloomberg.com
Scotiabank sells first Canadian defence bond as spending rises
