Bank of Nova Scotia Launches High-Coupon Structured Notes Tied to NVIDIA

Rhea-AI Filing Summary

The Bank of Nova Scotia (BNS) is marketing a new Series A Equity-Linked Security (senior, unsecured notes) that references the common stock of NVIDIA Corporation (NVDA). Each security has a $1,000 face amount, is expected to price on 18 July 2025 and settle on 23 July 2025.

Income profile: Investors are eligible for a monthly contingent coupon of at least 13.65% per annum (paid three business days after each calculation day) but only when NVDA’s closing price on the relevant calculation day is at or above the Coupon Threshold = 65 % of the starting price. Missed coupons are not recoverable.

Automatic call: Beginning with the sixth calculation day (January 2026) and extending through June 2026, the notes will be automatically redeemed at par plus the final coupon if NVDA’s closing price on any calculation day equals or exceeds the starting price.

Maturity payoff: If not called, the notes mature on 23 July 2026. • If the ending price ≥ Downside Threshold (65 % of starting price), holders receive par. • Otherwise, repayment equals par × (ending price / starting price), exposing investors to full downside below the 35 % buffer, with maximum loss of 100 %.

Estimated value: If priced today, BNS estimates the fair value at $943.11–$973.11 per $1,000, implying an initial issuer/dealer discount of up to 5.7 %. Scotia Capital Inc. is calculation agent; Scotia Capital (USA) Inc. and Wells Fargo Securities will act as agents, with combined selling concessions and fees of up to 2.9 %.

Key risks disclosed include: potential loss of principal, non-fixed interest, credit risk of BNS, liquidity constraints, single-stock concentration, reinvestment risk on early call, and uncertain tax treatment. The securities are not FDIC-insured.

The term sheet is only a summary; investors should review the full preliminary pricing supplement, product supplement, prospectus supplement and base prospectus filed under SEC Registration No. 333-282565.

Positive

• High contingent coupon rate of at least 13.65 % p.a. offers elevated income potential versus conventional IG notes.
• 35 % downside buffer (threshold at 65 % of starting price) provides partial principal protection if NVDA declines moderately.
• Automatic call feature allows early return of capital at par plus coupon if NVDA performs well between Jan–Jun 2026.

Negative

• Principal at risk: investors suffer full downside exposure below the 65 % threshold and can lose up to 100 % of invested capital.
• Coupon is not guaranteed; no payments occur if NVDA is below the threshold on any calculation day.
• Issuer/market value gap: estimated fair value (94.3-97.3 % of par) signals an initial cost of up to 5.7 % to investors.
• Liquidity risk: notes are not expected to trade actively; secondary prices may be well below theoretical value.
• Credit risk of BNS adds exposure unrelated to NVDA’s performance.

Insights

Structured Products Analyst

TL;DR – High coupon, 35 % buffer, full downside after threshold; routine issuance for BNS.

This FWP outlines a standard U.S. market-linked note tied to NVDA. The minimum 13.65 % contingent coupon is attractive relative to IG credit, but the income is conditional and could be zero throughout the term if NVDA trades below 65 % of the July-2025 starting price. The 35 % principal buffer is typical; below that level, investors are effectively long the stock on a 1-for-1 basis without upside. Automatic call from month 6 caps holding period and favours the issuer when NVDA performs well. Estimated value (94.3-97.3 % of par) shows a noticeable structuring spread. Credit exposure to BNS (A- / A2) remains. Overall, this is a routine shelf-registered issuance; it does not represent a material event for BNS shareholders but provides income-seeking investors with a leveraged view on NVDA.

 	Filed Pursuant to Rule 433 Dated June 26, 2025 Registration No. 333-282565
The Bank of Nova Scotia Senior Note Program, Series A Equity Linked Securities

Summary of Terms

Issuer	The Bank of Nova Scotia (the “Bank”)
Market Measure	The common stock of NVIDIA Corporation (the “Underlying Stock”) (Bloomberg Ticker: NVDA)
Pricing Date*	July 18, 2025
Issue Date*	July 23, 2025
Face Amount (Original Offering Price)	$1,000 per security
Contingent Coupon Payment	On each contingent coupon payment date, you will receive a contingent coupon payment at a per annum rate equal to the contingent coupon rate if, and only if, the stock closing price of the Underlying Stock on the related calculation day is greater than or equal to the coupon threshold price. Each contingent coupon payment, if any, will be calculated per security as follows: ($1,000 × contingent coupon rate) / 12. Any contingent coupon payment will be rounded to the nearest cent, with one-half cent rounded upward.
Contingent Coupon Rate	At least 13.65% per annum, to be determined on the pricing date
Calculation Days*	Monthly, on the 18th day of each month, commencing August 2025 and ending in July 2026, each subject to postponement. We refer to the calculation day scheduled to occur in July 2026 (expected to be July 20, 2026) as the “final calculation day.”
Contingent Coupon Payment Dates	Three business days after the applicable calculation day (the contingent coupon payment date with respect to the final calculation day will be the stated maturity date), each subject to postponement
Automatic Call	If the stock closing price of the Underlying Stock on any calculation day from January 2026 to June 2026, inclusive, is greater than or equal to the starting price, the securities will be automatically called, and on the related call settlement date, you will be entitled to receive a cash payment per security in U.S. dollars equal to the face amount plus a final contingent coupon payment. The securities will not be subject to automatic call until the sixth calculation day, which is approximately six months after the issue date.
Call Settlement Date	Three business days after the applicable calculation day, subject to postponement
Maturity Payment Amount (per Security)	If the securities are not automatically called prior to the stated maturity date: ●if the ending price is greater than or equal to the downside threshold price: $1,000; or ●if the ending price is less than the downside threshold price: $1,000 × performance factor
Performance Factor	The ending price divided by the starting price (expressed as a percentage)
Stated Maturity Date*	July 23, 2026, subject to postponement
Starting Price	The stock closing price of the Underlying Stock on the pricing date
Ending Price	The stock closing price of the Underlying Stock on the final calculation day
Coupon Threshold Price	65.00% of the starting price
Downside Threshold Price	65.00% of the starting price
Calculation Agent	Scotia Capital Inc., an affiliate of the Bank
Denominations	$1,000 and any integral multiple of $1,000
Agents**	Scotia Capital (USA) Inc. and Wells Fargo Securities, LLC (“WFS”). WFS will receive a discount of up to 1.825%; dealers, including Wells Fargo Advisors, LLC (“WFA”), may receive a selling concession of up to 1.00%, and WFA may receive a distribution expense fee of 0.075%.
CUSIP / ISIN	06418VZD9 / US06418VZD99
Material Canadian and U.S. Tax Consequences	See the preliminary pricing supplement.

* Subject to change.

** In respect of certain securities, we may pay a fee of up to $1.00 per security to selected securities dealers for marketing and other services in connection with the distribution of the securities to other securities dealers.

 

Hypothetical Payout Profile

If the securities are not automatically called prior to stated maturity and the ending price is less than the downside threshold price, you will lose more than 35%, and possibly all, of the face amount of your securities at stated maturity.

Any return on the securities will be limited to the sum of your contingent coupon payments, if any. You will not participate in any appreciation of the Underlying Stock, but you will have full downside exposure to the Underlying Stock if the ending price is less than the downside threshold price.

 

If the securities priced today, the estimated value of the securities would be between $943.11 (94.311%) and $973.11 (97.311%) per $1,000 face amount. See “The Bank’s Estimated Value of the Securities” in the preliminary pricing supplement.

Preliminary pricing supplement:

http://www.sec.gov/Archives/edgar/data/9631/000183988225034967/bns_424b2-18956.htm

The securities have complex features and investing in the securities involves risks not associated with an investment in conventional debt securities. See “Selected Risk Considerations” in this term sheet, “Selected Risk Considerations” in the preliminary pricing supplement and “Risk Factors” in the product supplement, prospectus supplement and prospectus.

This introductory term sheet does not provide all the information that an investor should consider prior to making an investment decision. This term sheet should be read in conjunction with the preliminary pricing supplement, product supplement, prospectus supplement, and prospectus.

NOT A BANK DEPOSIT AND NOT INSURED OR GUARANTEED BY THE FDIC OR ANY OTHER GOVERNMENTAL AGENCY

 

Selected Risk Considerations

The risks set forth below are discussed in detail in “Selected Risk Considerations” in the preliminary pricing supplement and “Risk Factors” in the product supplement, prospectus supplement and prospectus. Please review those risk disclosures carefully.

Risks Relating To The Securities Generally ●If The Securities Are Not Automatically Called Prior To Stated Maturity, You May Lose Some Or All Of The Face Amount Of Your Securities At Stated Maturity. ●The Securities Do Not Provide For Fixed Payments Of Interest And You May Receive No Coupon Payments On One Or More Contingent Coupon Payment Dates, Or Even Throughout The Entire Term Of The Securities. ●You May Be Fully Exposed To The Decline In The Underlying Stock On The Final Calculation Day From The Starting Price, But Will Not Participate In Any Positive Performance Of The Underlying Stock. ●Higher Contingent Coupon Rates Are Associated With Greater Risk. ●You Will Be Subject To Reinvestment Risk. Risks Relating To An Investment In the Bank’s Debt Securities, Including The Securities ●Your Investment Is Subject To The Credit Risk Of The Bank. Risks Relating To The Estimated Value Of The Securities And Any Secondary Market ●The Inclusion Of Dealer Spread And Projected Profit From Hedging In The Original Offering Price Is Likely To Adversely Affect Secondary Market Prices. ●The Bank's Estimated Value Of The Securities Will Be Lower Than The Original Offering Price Of The Securities. ●The Bank's Estimated Value Does Not Represent Future Values Of The Securities And May Differ From Others' Estimates. ●The Bank's Estimated Value Is Not Determined By Reference To Credit Spreads For Our Conventional Fixed-Rate Debt. ●If The Price Of The Underlying Stock Changes, The Market Value Of Your Securities May Not Change In The Same Manner. ●The Price At Which The Securities May Be Sold Prior To Maturity Will Depend On A Number Of Factors And May Be Substantially Less Than The Amount For Which They Were Originally Purchased. ●The Securities Lack Liquidity. Risks Relating To The Underlying Stock ●The Securities Will Be Subject To Single Stock Risk. ●Investing In The Securities Is Not The Same As Investing In The Underlying Stock. ●Historical Prices Of The Underlying Stock Should Not Be Taken As An Indication Of The Future Performance Of The Underlying Stock During The Term Of The Securities. ●The Securities May Become Linked To The Common Stock Of A Company Other Than An Original Underlying Stock Issuer. ●We, The Agents And Our Respective Affiliates Cannot Control Actions By An Underlying Stock Issuer. ●We, The Agents And Our Respective Affiliates Have No Affiliation With Any Underlying Stock Issuer And Have Not Independently Verified Their Public Disclosure Of Information. ●You Have Limited Anti-dilution Protection. Risks Relating To Hedging Activities And Conflicts Of Interest ●A Participating Dealer Or Its Affiliates May Realize Hedging Profits Projected By Its Proprietary Pricing Models In Addition To Any Selling Concession And/Or Any Distribution Expense Fee, Creating A Further Incentive For The Participating Dealer To Sell The Securities To You. ●Hedging Activities By The Bank And/Or The Agents May Negatively Impact Investors In The Securities And Cause Our Respective Interests And Those Of Our Clients And Counterparties To Be Contrary To Those Of Investors In The Securities. ●Market Activities By The Bank Or The Agents For Their Own Respective Accounts Or For Their Respective Clients Could Negatively Impact Investors In The Securities. ●The Bank, The Agents And Their Respective Affiliates Regularly Provide Services To, Or Otherwise Have Business Relationships With, A Broad Client Base, Which Has Included And May Include Issuers Of An Underlying Stock, The Sponsor Or Investment Advisor For A Fund And/Or The Issuers Of Securities Included In An Underlying Stock Or Held By A Fund. ●Other Investors In The Securities May Not Have The Same Interests As You. ●There Are Potential Conflicts Of Interest Between You And The Calculation Agent. ●A Contingent Coupon Payment Date, A Call Settlement Date And The Stated Maturity Date May Be Postponed If A Calculation Day Is Postponed. Risks Relating to Canadian and U.S. Federal Income Taxation ●The Tax Consequences Of An Investment In The Securities Are Unclear. Significant aspects of the tax treatment of the securities are uncertain. You should consult your tax advisor about your tax situation. See “Canadian Income Tax Consequences” and “U.S. Federal Income Tax Consequences” in the preliminary pricing supplement.

The Bank has filed a registration statement (including a prospectus) with the SEC for the offering to which this communication relates. Before you invest, you should read the prospectus in that registration statement and other documents the Bank has filed with the SEC for more complete information about the Bank and this offering. You may get these documents for free by visiting EDGAR on the SEC website at www.sec.gov. Alternatively, the Bank, any Underwriter or any dealer participating in the offering will arrange to send you the prospectus if you request it by calling your financial advisor or by calling Wells Fargo Securities, LLC at 866-346-7732.

Wells Fargo Advisors is a trade name used by Wells Fargo Clearing Services, LLC and Wells Fargo Advisors Financial Network, LLC, members SIPC, separate registered broker-dealers and non-bank affiliates of Wells Fargo & Company.

FAQ

What is the minimum contingent coupon on BNS NVDA-linked notes?

At least 13.65 % per annum, paid monthly when NVDA closes at or above 65 % of the starting price.

When can the Bank of Nova Scotia notes be automatically called?

On any calculation day from January 2026 to June 2026 if NVDA’s price is ≥ the starting price.

How much principal protection do the BNS Equity-Linked Securities offer?

A 35 % buffer; below 65 % of the starting price, investors lose principal in line with NVDA’s decline.

What is the estimated initial value of the securities?

BNS estimates $943.11–$973.11 per $1,000 face amount, reflecting structuring fees and hedging costs.

Are the BNS NVDA-linked notes FDIC-insured?

No. They are senior unsecured obligations of BNS and are not insured or guaranteed by the FDIC or any government agency.