Bank Nova Scotia SEC Filings

The Bank of Nova Scotia (BNS) is marketing Accelerated Return Notes® (ARNs) linked to the common stock of Apple Inc. (AAPL) with a 14-month maturity (settlement expected July 2025 – September 2026). Each $10 note offers 300 % leveraged exposure to any positive price move in AAPL, but gains are capped at a 20 %–24 % total return (Capped Value $12.00–$12.40 per unit). If AAPL ends flat, principal is returned; if it declines, investors are exposed 1-for-1 to losses, up to total principal at risk.

Key structural terms

• Issuer: The Bank of Nova Scotia, senior unsecured obligations.
• Underlying: Apple Inc. common stock (NASDAQ: AAPL).
• Participation Rate: 300 % on upside, subject to the cap.
• Term: ≈ 14 months; calculation day is the 5th trading day before maturity.
• Initial estimated value: $9.24–$9.54 per $10 unit, below the public offer price because of BNS’s lower internal funding rate, a $0.175 underwriting discount and a $0.05 hedging-related charge.
• Minimum purchase size: 100 units; price concessions for ≥ 300,000 units lower the public price to $9.95 and discount to $0.125.
• No periodic coupons, no dividend entitlement, limited or no secondary market; notes will not be listed on any exchange.

Risk highlights

• Full downside exposure: any drop in AAPL below the starting value erodes principal dollar-for-dollar.
• Credit risk: repayment depends on BNS’s ability to pay; the notes rank pari passu with other senior unsecured debt.
• Valuation risk: initial estimated value below purchase price; secondary market bids (if any) expected to be at a discount due to dealer mark-ups, funding rate differential and market factors.
• Liquidity risk: BofA Securities and Merrill Lynch are not obliged to make a market; investors may be unable to exit prior to maturity.
• Tax uncertainty: U.S. federal tax treatment is uncertain; notes expected to be prepaid derivatives, but IRS guidance could differ.

The product may appeal to short-term tactical investors who expect a moderate rise in AAPL over the next year and can tolerate issuer credit risk, illiquidity and a hard upside cap. It is not designed for income seekers, long-term buy-and-hold equity investors, or those requiring principal protection.

The Bank of Nova Scotia (BNS) is offering STEP Income Securities® linked to Schlumberger N.V. (NYSE: SLB) with a brief tenor of roughly one year and one week, priced at $10 per unit. The notes are senior, unsecured obligations of BNS and are subject to full issuer credit risk. They pay fixed quarterly interest of 12.00% per annum and may deliver an additional Step Payment between $0.10 – $0.50 per unit (1.0 – 5.0% of par) if, on the valuation date, SLB closes at or above 112% of the Starting Value.

Principal is fully at risk. Should the Ending Value fall below the Starting Value—even by a penny—investors receive their $10 principal reduced 1-for-1 with the stock’s decline, down to zero. There is no protection at the 100% Threshold Value. Hence, the maximum payoff equals cumulative interest plus the Step Payment, while downside exposure is effectively uncapped.

Economic terms & fees: the initial estimated value is disclosed as $9.298 – $9.698, materially beneath the $10 issue price, reflecting a $0.15 underwriting discount and a $0.05 hedging-related charge. Large orders (≥300,000 units) receive a $0.05 per unit price concession. The notes will not be listed on any exchange and BofA Securities is not obligated to maintain a secondary market, limiting liquidity.

Key parameters

• Term: ≈ 1 year 1 week; Settlement: July 2025; Maturity: August 2026
• Interest Payment Dates: Nov 2025, Feb 2026, May 2026, Aug 2026
• Step Level: 112% of Starting Value | Price Multiplier: 1
• Calculation Agent: BofA Securities, Inc.

Investor profile: suitable only for investors seeking high fixed income and modest equity-linked upside who are willing to accept (1) 100% downside exposure to SLB, (2) issuer credit risk, (3) limited liquidity, and (4) the structural valuation drag from fees and funding spread.

Offering overview: The Bank of Nova Scotia (BNS) is issuing $15,316,000 of Contingent Income Auto-Callable Securities due July 7, 2028 linked to the common stock of Tesla, Inc. (TSLA). Each unlisted, senior unsecured note has a $1,000 stated principal amount and priced at par on July 3, 2025.

Coupon mechanics: Investors may receive a contingent quarterly coupon of $41.625 (16.65% p.a.) on any determination date where TSLA’s closing price is ≥ the downside threshold price of $157.675 (50 % of the $315.35 initial share price). Missed coupons are recoverable under the “memory” feature if the threshold is met on a later date.

Auto-call feature: If TSLA closes at or above the call threshold price of $315.35 (100 % of initial) on any of the first 11 determination dates, the notes are automatically redeemed for (i) principal plus (ii) the current and any previously unpaid coupons. Early redemption could shorten the investment horizon to as little as three months.

Maturity scenarios: • If the notes are not called and TSLA’s final share price is ≥ the downside threshold, holders receive principal plus all due coupons. • If the final share price is < the downside threshold, repayment equals principal × (Final Price / Initial Price), exposing investors to a 1:1 downside that can reduce the payment to < 50 % of principal and potentially to zero.

Economic considerations: The issuer’s estimated value is $971.10 per note, 2.9 % below the $1,000 issue price, reflecting dealer compensation of $22.50 and hedging costs. Aggregate issuance size is modest relative to BNS’s balance sheet. All payments depend on BNS credit; the securities are not CDIC or FDIC insured.

Key risks: principal is at risk; coupons are not guaranteed; limited secondary market, as the notes will not be listed; potential mismatch between investors’ view on TSLA volatility and the fixed coupon; and tax treatment remains uncertain. Investors also forego any dividends and upside participation in Tesla stock.

Investor profile: Suitable only for sophisticated investors who can tolerate full loss of capital, accept BNS credit risk, and seek high contingent income linked to TSLA performance for up to three years.

The Bank of Nova Scotia (BNS) is offering $20.967 million of senior unsecured Contingent Income Auto-Callable Securities due 7 Jul 2028 linked to the common stock of Palantir Technologies Inc. (PLTR).

Key structural terms

• Issue price / face value: $1,000 per note; minimum investment one note.
• Contingent quarterly coupon: $47.875 per note (19.15% p.a.) paid only if the PLTR closing price on a determination date is ≥ the Downside Threshold Price (50% of the Initial Share Price). A memory feature allows catch-up of previously missed coupons.
• Initial Share Price: $134.36 (PLTR close on 3 Jul 2025).
• Call Threshold Price: $134.36 (100% of initial). If PLTR closes ≥ this level on any of the 11 quarterly determination dates before final maturity, the notes are called and investors receive: (i) principal + (ii) the due coupon + any unpaid memory coupons.
• Downside Threshold Price: $67.18 (50% of initial). If the final share price is below this level at maturity and the notes were not previously called, repayment equals principal × (Final / Initial), exposing investors 1-for-1 to PLTR downside and placing up to 100% of capital at risk.
• Maturity: 7 Jul 2028 (≈3 years) unless called earlier.
• Issuer credit risk: Payments depend solely on BNS; the notes are not CDIC or FDIC insured.
• Secondary trading / listing: No exchange listing; liquidity, if any, expected only via Scotia Capital (USA) Inc.
• Estimated value at pricing: $968.30 (3.17% below issue price) reflecting internal funding rate, $17.50 sales commission and $5.00 structuring fee per note.

Risk highlights

• No principal protection; investors can lose all capital if PLTR declines ≥50% and remains uncalled.
• Coupon payments are contingent; if PLTR trades below the threshold on all 12 observation dates, total return can be zero.
• High PLTR volatility increases call uncertainty and principal loss probability despite boosting the quoted coupon.
• Credit exposure to BNS and limited liquidity may force sales at deep discounts.
• Estimated note value below issue price indicates embedded costs that lower investor economics.

Investor profile: suitable only for investors who (1) are comfortable with single-stock exposure to PLTR, (2) can tolerate complete loss of principal, (3) are willing to forego dividends and upside beyond coupons, and (4) accept BNS credit and liquidity risk in exchange for a potentially high, but uncertain, cash yield.

The Bank of Nova Scotia (BNS) is marketing Contingent Income Auto-Callable Securities linked to UnitedHealth Group Inc. (UNH) common stock. Each $1,000 note offers a contingent quarterly coupon of $32.50 (13.0% p.a.) provided UNH’s closing price on the relevant determination date is at or above a 60% downside threshold. Missed coupons can be recovered later through a memory feature. If, on any quarterly determination date before maturity, UNH closes at or above its initial price, the note is auto-called and the investor receives the principal plus any due coupons.

Maturity profile: Pricing is scheduled for 18 Jul 2025 with maturity (or last call opportunity) on 21 Jul 2028. At maturity, investors receive: (i) principal plus due coupons if UNH is ≥60% of the initial price, or (ii) principal multiplied by UNH price performance if below the threshold—potentially as low as zero. Investors do not participate in any upside beyond coupon payments.

The notes are senior unsecured debt of BNS; all payments are subject to BNS credit risk. They are unlisted, non-transferable on exchanges and include a 2.25% selling commission. BNS’ estimated value on the pricing date is expected to range between $932 and $962 per $1,000 note, underscoring an initial value discount versus issue price. Extensive risk factors highlight price volatility of UNH, liquidity constraints, potential conflicts from BNS/SCUSA hedging, and uncertain tax treatment.