PRICING SUPPLEMENT No. WFC252 dated May 15, 2024
(To the Product Supplement No. WF1, the Prospectus
Supplement and the Prospectus, each dated December 20, 2023)
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Registration Statement No. 333-275898
Filed Pursuant to Rule 424(b)(2) |
Royal Bank of Canada
Senior Global Medium-Term Notes, Series J
Equity Linked Securities
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Market Linked Securities—Auto-Callable with Contingent Coupon
with Memory Feature and Contingent Downside
Principal at Risk Securities Linked to the Common Stock of NVIDIA Corporation due May 20,
2027
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■ Linked to the common stock of NVIDIA Corporation (the “Underlying Stock”)
■ Unlike ordinary debt securities, the securities do not provide for fixed payments of interest, do not repay a fixed amount of principal at stated maturity and are subject to potential
automatic call prior to stated maturity upon the terms described below. Whether the securities pay a contingent coupon payment, whether the securities are automatically called prior to stated maturity and, if they are not automatically
called, whether you receive the face amount of your securities at stated maturity will depend, in each case, on the stock closing price of the Underlying Stock on the relevant calculation day.
■ Contingent Coupon. The securities will pay a contingent coupon payment on a quarterly basis until the earlier of stated maturity or automatic call
if, and only if, the stock closing price of the Underlying Stock on the calculation day for that quarter is greater than or equal to the threshold price. If the stock closing price of the
Underlying Stock on one or more calculation days is less than the threshold price and, on a subsequent calculation day, the stock closing price of the Underlying Stock on that subsequent calculation day is greater than or equal to the
threshold price, the securities will pay the contingent coupon payment due for that subsequent calculation day plus all previously unpaid contingent coupon payments (without interest on amounts previously unpaid). If the stock closing
price of the Underlying Stock on a calculation day is less than the threshold price, you will not receive any contingent coupon payment on the related quarterly contingent coupon payment date. In addition, if the stock closing price of
the Underlying Stock on a calculation day is less than the threshold price and the stock closing price of the Underlying Stock on each subsequent calculation day up to and including the final calculation day is less than the threshold
price, you will not receive the unpaid contingent coupon payments in respect of those calculation days. If the stock closing price of the Underlying Stock is less than the threshold price on every calculation day, you will not receive any
contingent coupon payments throughout the entire term of the securities. The threshold price for the Underlying Stock is equal to 60% of the starting price. The contingent coupon rate is 13.50% per annum
■ Automatic Call. If the stock closing price of the Underlying Stock on any of the quarterly calculation days from August 2024 to February 2027,
inclusive, is greater than or equal to the starting price, the securities will be automatically called for the face amount plus a final contingent coupon payment and any previously unpaid contingent coupon payments
■ Potential Loss of Principal. If the securities are not automatically called prior to stated maturity, you will receive the face amount at stated
maturity if, and only if, the ending price is greater than or equal to the threshold price. If the ending price is less than the threshold price, you will lose more than 40%, and possibly all, of
the face amount of your securities. The threshold price is equal to 60% of the starting price.
■ If the securities are not automatically called prior to
stated maturity, you will have full downside exposure to the Underlying Stock from the starting price if the ending price is less than the threshold price, but you will not participate in any appreciation of the Underlying Stock and will
not receive any dividends on the Underlying Stock
■ All payments on the securities are subject to credit risk, and you will have no ability to pursue the issuer of the Underlying Stock for payment; if Royal Bank of Canada defaults on its
obligations, you could lose some or all of your investment
■ No exchange listing; designed to be held to maturity or automatic call
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Our initial estimated value of the securities as of the pricing date was $969.94 per $1,000 in principal amount, which is less than the public offering price. The market
value of the securities at any time will reflect many factors, cannot be predicted with accuracy, and may be less than this amount. See “Estimated Value of the Securities” for further information.
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Original Offering Price
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Agent Discount(1)(2)
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Proceeds to Royal Bank of
Canada
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Per Security
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$1,000.00
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$23.25
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$976.75
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Total
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2,252,000.00
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$52,359.00
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$2,199,641.00
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(1) |
Wells Fargo Securities, LLC is the agent for the distribution of the securities and is acting as principal. See “Terms of the Securities—Agent” and “Estimated Value of the Securities” in this pricing supplement
for further information.
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(2) |
In addition to the forgoing, in respect of certain securities sold in this offering, our affiliate, RBC Capital Markets, LLC (“RBCCM”), may pay a fee of up to $2.00 per security to selected securities
dealers in consideration for marketing and other services in connection with the distribution of the securities to other securities dealers.
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Market Linked Securities—Auto-Callable with Contingent Coupon
with Memory Feature and Contingent Downside
Principal at Risk Securities Linked to the Common Stock of NVIDIA Corporation due May 20,
2027
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Terms of the Securities
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Issuer:
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Royal Bank of Canada.
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Market
Measure:
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The common stock of NVIDIA Corporation (the “Underlying Stock”)
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Pricing Date:
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May 15, 2024.
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Issue Date:
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May 20, 2024.
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Original
Offering Price:
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$1,000 per security.
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Face Amount:
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$1,000 per security. References in this pricing supplement to a “security” are to a security with a face amount of $1,000.
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Contingent
Coupon
Payment (with
Memory
Feature):
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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 threshold price. Each “contingent coupon payment,” if any, will be calculated per security as follows: ($1,000 × contingent coupon
rate)/4. In addition, if the stock closing price of the Underlying Stock on one or more calculation days is less than the threshold price and, on a subsequent calculation day, the stock closing price of the Underlying Stock on that
subsequent calculation day is greater than or equal to the threshold price, the securities will pay the contingent coupon payment due for that subsequent calculation day plus all previously unpaid contingent coupon payments (without
interest on amounts previously unpaid). Any contingent coupon payment will be rounded to the nearest cent, with one-half cent rounded upward.
If the stock closing price of the Underlying Stock on any calculation day is less than the threshold price, you will not receive any contingent coupon payment on the related contingent
coupon payment date. In addition, if the stock closing price of the Underlying Stock on a calculation day is less than the threshold price and the stock closing price of the Underlying Stock on each subsequent calculation day up to and
including the final calculation day is less than the threshold price, you will not receive the unpaid contingent coupon payments in respect of those calculation days. If the stock closing price of the Underlying Stock is less than the
threshold price on all calculation days, you will not receive any contingent coupon payments over the term of the securities.
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Contingent
Coupon
Payment
Dates:
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Quarterly, on the third business day following each calculation day (as each such calculation day may be postponed pursuant to “—Market Disruption Events and Postponement Provisions” below, if applicable); provided that the contingent coupon payment date with respect to the final calculation day will be the stated maturity date.
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Contingent
Coupon Rate:
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The “contingent coupon rate” is 13.50% per annum.
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Automatic
Call:
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If the stock closing price of the Underlying Stock on any of the calculation days from August 2024 to February 2027, 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, and any previously unpaid contingent
coupons. The securities will not be subject to automatic call until the first calculation day, which is approximately three months after the issue date.
If the securities are automatically called, they will cease to be outstanding on the related call settlement date and you will have no further rights under the securities after such call settlement date. You
will not receive any notice from us if the securities are automatically called.
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Calculation
Days:
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Quarterly, on the 15th day of each February, May, August and November, commencing in August 2024 and ending in February 2027, and the final calculation day, each subject to postponement as described below
under “—Market Disruption Events and Postponement Provisions.” We refer to May 17, 2027 as the “final calculation day.”
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Call
Settlement
Date:
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Three business days after the applicable calculation day (as each such calculation day may be postponed pursuant to “—Market Disruption Events and Postponement Provisions” below, if applicable).
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Stated Maturity
Date:
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May 20, 2027, subject to postponement. The securities are not subject to repayment at the option of any holder of the securities prior to the stated maturity date.
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Market Linked Securities—Auto-Callable with Contingent Coupon
with Memory Feature and Contingent Downside
Principal at Risk Securities Linked to the Common Stock of NVIDIA Corporation due May 20,
2027
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Maturity
Payment
Amount:
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If the securities are not automatically called prior to the stated maturity date, you will be entitled to receive on the stated maturity date a cash payment per security in U.S. dollars equal to the maturity
payment amount (in addition to the final contingent coupon payment and any unpaid contingent coupon payments, if payable). The “maturity payment amount” per security will equal:
• if the ending price is greater than or equal to the threshold price: $1,000; or
• if the ending price is less than the threshold price:
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$1,000 × performance factor
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If the securities are not automatically called prior to stated maturity and the ending price is less than the threshold price, you will lose more than 40%, 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 threshold price.
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Starting Price:
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$946.30, the stock closing price of the Underlying Stock on the pricing date.
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Stock Closing
Price:
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Stock closing price, closing price and adjustment factor have the meanings set forth under “General Terms of the Securities—Certain Terms for Securities Linked to an Underlying
Stock—Certain Definitions” in the accompanying product supplement.
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Ending Price:
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The “ending price” will be the stock closing price of the Underlying Stock on the final calculation day.
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Performance
Factor:
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The ending price divided by the starting price (expressed as a percentage).
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Threshold
Price:
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$567.78, which is equal to 60% of the starting price.
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Market
Disruption
Events and Postponement
Provisions:
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Each calculation day (including the final calculation day) is subject to postponement due to non-trading days and the occurrence of a market disruption event. In addition, the stated maturity date will be
postponed if the final calculation day is postponed, and will be adjusted for non-business days. For more information regarding adjustments to the calculation days and the stated maturity date, see “General Terms of the
Securities—Consequences of a Market Disruption Event; Postponement of a Calculation Day—Securities Linked to a Single Market Measure” and “—Payment Dates” in the accompanying product supplement. For purposes of the accompanying product
supplement, each call settlement date and the stated maturity date is a “payment date.” In addition, for information regarding the circumstances that may result in a Market Disruption Event, see “General Terms of the Securities—Certain
Terms for Securities Linked to an Underlying Stock—Market Disruption Events” in the accompanying product supplement.
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Calculation
Agent:
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RBC Capital Markets, LLC (“RBCCM”)
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Material Tax
Consequences:
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For a discussion of the material U.S. federal income and certain estate tax consequences of the ownership and disposition of the securities, see “United States Federal Tax Considerations” below and the
section “United States Federal Tax Considerations” in the product supplement. For a discussion of the material Canadian federal income tax consequences relating to the securities, please see the section of the product supplement, “Canadian
Federal Income Tax Consequences.”
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Agent:
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Wells Fargo Securities, LLC (“WFS”). The agent will receive the agent discount set forth on the cover page of this document. The agent may resell the securities to other securities dealers at the original offering price of the
securities less a concession not in excess of $17.50 per security. Such securities dealers may include Wells Fargo Advisors (“WFA”) (the trade name of the retail brokerage business of WFS’s affiliates, Wells Fargo Clearing Services, LLC and
Wells Fargo Advisors Financial Network, LLC). In addition to the concession allowed to WFA, WFS may pay $0.75 per security of the agent’s discount to WFA as a distribution expense fee for each security sold by WFA.
In addition to the forgoing, in respect of certain securities sold in this offering, our affiliate, RBCCM, may pay a fee of up to $2.00 per security to selected securities dealers in consideration for marketing
and other services in connection with the distribution of the securities to other securities dealers. We or one of our affiliates will also pay an expected fee to a broker-dealer that is unaffiliated with us for providing certain electronic
platform services with respect to this offering.
WFS and/or RBCCM, and/or one or more of their respective affiliates expects to realize hedging profits projected by their proprietary pricing models to the extent they assume the risks inherent in hedging our
obligations under the securities. If WFS or any other dealer participating in the distribution of the securities or any of their affiliates conducts hedging activities for us in connection with the securities, that dealer or its affiliates
will expect to realize a profit projected by its proprietary pricing models from those hedging activities. Any such projected profit will be in addition to any discount, concession or fee received in connection with the sale of the
securities to you.
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Market Linked Securities—Auto-Callable with Contingent Coupon
with Memory Feature and Contingent Downside
Principal at Risk Securities Linked to the Common Stock of NVIDIA Corporation due May 20,
2027
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Denominations:
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$1,000 and any integral multiple of $1,000.
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CUSIP:
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78017FYE7
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Terms
Incorporated in
the Master Note:
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All of the terms of the securities appearing in this section “Terms of the Securities,” the applicable terms appearing under the caption “General Terms of the Securities” in the product supplement WF1, the
applicable terms included in the Series J MTN prospectus supplement and the prospectus, each dated December 20, 2023, are incorporated into the master global security that represents the securities and is held by The Depository Trust
Company.
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Market Linked Securities—Auto-Callable with Contingent Coupon
with Memory Feature and Contingent Downside
Principal at Risk Securities Linked to the Common Stock of NVIDIA Corporation due May 20,
2027
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Additional Information About the Issuer and the Securities
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• |
Product Supplement No. WF1 dated December 20, 2023:
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• |
Prospectus Supplement dated December 20, 2023:
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• |
Prospectus dated December 20, 2023:
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Market Linked Securities—Auto-Callable with Contingent Coupon
with Memory Feature and Contingent Downside
Principal at Risk Securities Linked to the Common Stock of NVIDIA Corporation due May 20,
2027
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Estimated Value of the Securities
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Market Linked Securities—Auto-Callable with Contingent Coupon
with Memory Feature and Contingent Downside
Principal at Risk Securities Linked to the Common Stock of NVIDIA Corporation due May 20,
2027
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Investor Considerations
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◾ |
seek an investment with contingent coupon payments at a rate of 13.50% per annum until the earlier of stated maturity or automatic call, if, and only if, the stock closing price of the Underlying
Stock on the applicable calculation day is greater than or equal to 60% of the starting price;
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◾ |
understand that if the securities are not automatically called prior to maturity, and the ending price has declined by more than 40% from the starting price, they will be fully exposed to the decline in the stock closing price from the
starting price and will lose more than 40%, and possibly all, of the face amount at stated maturity;
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◾ |
are willing to accept the risk that they may receive few or no contingent coupon payments over the term of the securities;
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◾ |
understand that the securities may be automatically called prior to stated maturity and that the term of the securities may be as short as approximately three months;
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◾ |
understand and are willing to accept the full downside risks of the Underlying Stock;
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◾ |
are willing to forgo participation in any appreciation of the Underlying Stock and dividends paid on the Underlying Stock; and
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are willing to hold the securities until maturity.
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seek a liquid investment or are unable or unwilling to hold the securities to maturity or any earlier automatic call;
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require full payment of the face amount of the securities at stated maturity;
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seek a security with a fixed term;
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◾ |
are unwilling to purchase securities with an estimated value as of the pricing date that is lower than the original offering price set forth on the cover page;
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◾ |
seek the certainty of current income over the term of the securities;
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◾ |
are unwilling to accept the risk that the stock closing price of the Underlying Stock on the final calculation day may decline by more than 40% from the starting price to the ending price;
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◾ |
seek exposure to the upside performance of the Underlying Stock;
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◾ |
are unwilling to accept the risk of exposure to the Underlying Stock;
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◾ |
are unwilling to accept the credit risk of Royal Bank of Canada to obtain exposure to the Underlying Stock; or
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◾ |
prefer the lower risk of fixed income investments with comparable maturities issued by companies with comparable credit ratings.
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Market Linked Securities—Auto-Callable with Contingent Coupon
with Memory Feature and Contingent Downside
Principal at Risk Securities Linked to the Common Stock of NVIDIA Corporation due May 20,
2027
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Determining Payment On A Contingent Coupon Payment Date and at Maturity
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Market Linked Securities—Auto-Callable with Contingent Coupon
with Memory Feature and Contingent Downside
Principal at Risk Securities Linked to the Common Stock of NVIDIA Corporation due May 20,
2027
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Hypothetical Payout Profile
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Market Linked Securities—Auto-Callable with Contingent Coupon
with Memory Feature and Contingent Downside
Principal at Risk Securities Linked to the Common Stock of NVIDIA Corporation due May 20,
2027
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Selected Risk Considerations
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Market Linked Securities—Auto-Callable with Contingent Coupon
with Memory Feature and Contingent Downside
Principal at Risk Securities Linked to the Common Stock of NVIDIA Corporation due May 20,
2027
|
Market Linked Securities—Auto-Callable with Contingent Coupon
with Memory Feature and Contingent Downside
Principal at Risk Securities Linked to the Common Stock of NVIDIA Corporation due May 20,
2027
|
Market Linked Securities—Auto-Callable with Contingent Coupon
with Memory Feature and Contingent Downside
Principal at Risk Securities Linked to the Common Stock of NVIDIA Corporation due May 20,
2027
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• |
Investing In The Securities Is Not The Same As Investing In The Underlying Stock. Investing in the securities is not equivalent to investing in the Underlying Stock.
As an investor in the securities, your return will not reflect the return you would realize if you actually owned and held the Underlying Stock for a period similar to the term of the securities because you will not receive any dividend
payments, distributions or any other payments paid on the Underlying Stock. As a holder of the securities, you will not have any voting rights or any other rights that holders of the Underlying Stock would have.
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Historical Prices Of The Underlying Stock Should Not Be Taken As An Indication Of Its Future Performance During The Term Of The Securities.
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The Securities May Become Linked To The Common Stock Of A Company Other Than The Original Underlying Stock Issuer.
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• |
We, The Agent And Our Respective Affiliates Cannot Control Actions By The Underlying Stock Issuer.
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We, The Agent And Our Respective Affiliates Have No Affiliation With The Underlying Stock Issuer And Have Not Independently Verified Its Public Disclosure Of Information.
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You Have Limited Anti-dilution Protection.
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The calculation agent is our affiliate and may be required to make discretionary judgments that affect the return you receive on the securities.
RBCCM, which is our affiliate, will be the calculation agent for the securities. As calculation agent, RBCCM will determine the stock closing prices of the Underlying Stock and make any other determinations necessary to calculate any
payments on the securities. In making these determinations, RBCCM may be required to make discretionary judgments that may adversely affect any payments on the securities. See the sections entitled “General Terms of the Securities—Certain
Terms for Securities Linked to an Underlying Stock—Market Disruption Events” and “—Adjustment Events” in the accompanying product supplement. In making these discretionary judgments, the fact that RBCCM is our affiliate may cause it to have
economic interests that are adverse to your interests as an investor in the securities, and RBCCM’s determinations as calculation agent may adversely affect your return on the securities.
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The estimated value of the securities was calculated by us and is therefore not an independent third-party valuation.
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Research reports by our affiliates or any participating dealer or its affiliates may be inconsistent with an investment in the securities and may adversely affect the price of the Underlying
Stock.
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Business activities of our affiliates or any participating dealer or its affiliates with the Underlying Stock Issuer may adversely affect the price of the Underlying Stock.
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• |
Hedging activities by our affiliates or any participating dealer or its affiliates may adversely affect the price of the Underlying Stock.
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• |
Trading activities by our affiliates or any participating dealer or its affiliates may adversely affect the price of the Underlying Stock.
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• |
A participating dealer or its affiliates may realize hedging profits projected by its proprietary pricing models in addition to any selling concession and/or fee, creating a further
incentive for the participating dealer to sell the securities to you.
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Market Linked Securities—Auto-Callable with Contingent Coupon
with Memory Feature and Contingent Downside
Principal at Risk Securities Linked to the Common Stock of NVIDIA Corporation due May 20,
2027
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Hypothetical Returns
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Hypothetical Ending Price
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Hypothetical Performance
Factor
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Hypothetical Maturity Payment
Amount per Security
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$175.00
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75.00%
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$1,000.00
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$160.00
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60.00%
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$1,000.00
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$150.00
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50.00%
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$1,000.00
|
$140.00
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40.00%
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$1,000.00
|
$130.00
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30.00%
|
$1,000.00
|
$120.00
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20.00%
|
$1,000.00
|
$110.00
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10.00%
|
$1,000.00
|
$100.00
|
0.00%
|
$1,000.00
|
$90.00
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-10.00%
|
$1,000.00
|
$80.00
|
-20.00%
|
$1,000.00
|
$70.00
|
-30.00%
|
$1,000.00
|
$60.00
|
-40.00%
|
$1,000.00
|
$59.00
|
-41.00%
|
$590.00
|
$50.00
|
-50.00%
|
$500.00
|
$40.00
|
-60.00%
|
$400.00
|
$30.00
|
-70.00%
|
$300.00
|
$25.00
|
-75.00%
|
$250.00
|
$0.00
|
-100.00%
|
$0.00
|
Market Linked Securities—Auto-Callable with Contingent Coupon
with Memory Feature and Contingent Downside
Principal at Risk Securities Linked to the Common Stock of NVIDIA Corporation due May 20,
2027
|
Hypothetical Contingent Coupon Payments
|
Underlying Stock
|
||
Hypothetical starting price:
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$100.00
|
|
Hypothetical stock closing price on hypothetical calculation day #1:
|
$90.00
|
|
Hypothetical threshold price:
|
$60.00
|
Underlying Stock
|
||
Hypothetical starting price:
|
$100.00
|
|
Hypothetical stock closing price on hypothetical calculation day #2:
|
$45.00
|
|
Hypothetical threshold price:
|
$60.00
|
Underlying Stock
|
||
Hypothetical starting price:
|
$100.00
|
|
Hypothetical stock closing price on hypothetical calculation day #3:
|
$115.00
|
|
Hypothetical threshold price:
|
$60.00
|
Market Linked Securities—Auto-Callable with Contingent Coupon
with Memory Feature and Contingent Downside
Principal at Risk Securities Linked to the Common Stock of NVIDIA Corporation due May 20,
2027
|
Hypothetical Payment at Stated Maturity
|
Underlying Stock
|
||
Hypothetical starting price:
|
$100.00
|
|
Hypothetical ending price:
|
$145.00
|
|
Hypothetical threshold price:
|
$60.00
|
Underlying Stock
|
||
Hypothetical starting price:
|
$100.00
|
|
Hypothetical ending price:
|
$80.00
|
|
Hypothetical threshold price:
|
$60.00
|
Market Linked Securities—Auto-Callable with Contingent Coupon
with Memory Feature and Contingent Downside
Principal at Risk Securities Linked to the Common Stock of NVIDIA Corporation due May 20,
2027
|
Underlying Stock
|
||
Hypothetical starting price:
|
$100.00
|
|
Hypothetical ending price:
|
$45.00
|
|
Hypothetical threshold price:
|
$60.00
|
|
Performance factor (ending price divided by starting price):
|
45.00%
|
Market Linked Securities—Auto-Callable with Contingent Coupon
with Memory Feature and Contingent Downside
Principal at Risk Securities Linked to the Common Stock of NVIDIA Corporation due May 20,
2027
|
The Underlying Stock
|
Market Linked Securities—Auto-Callable with Contingent Coupon
with Memory Feature and Contingent Downside
Principal at Risk Securities Linked to the Common Stock of NVIDIA Corporation due May 20,
2027
|
United States Federal Tax Considerations
|
Market Linked Securities—Auto-Callable with Contingent Coupon
with Memory Feature and Contingent Downside
Principal at Risk Securities Linked to the Common Stock of NVIDIA Corporation due May 20,
2027
|
Validity of the Securities
|