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Brookfield Infrastructure Partners L.P. (BIP.UN $42.42)
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Brookfield Infrastructure Partners LP Limited Partnership Units (BIP $30.66)
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Brookfield Infrastructure Corporation Class A Exchangeable Subordinate Voting Shares (BIPC $55.41)
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Brookfield Infrastructure Corporation (BIPC $40.02)
Q: Hello 5i Team
Further to the reader’s question about US$ denominated dividend deposited into US$ denominated accounts at RBC Direct Investing.
I experienced the same issue with RBC Direct Investing and they explained as follows. I will use Brookfield Infrastructure
Partners (BIP) which I hold in a US$ denominated account.
BIP transfers the total dividend to Canadian Depositary for Securities (CDS) for all the BIP shares held by CDS (in excess of 100 million shares) on behalf of Canadian Brokers. This dividend payment (in US $) is converted to C$ (unclear whether its BIP or CDS) at “wholesale” rates.
CDS then transfers to each Canadian Broker (i.e. RBCDI) the Canadian dollar equivalent of BIP dividends held by the individual brokers (i.e. RBCDI). RBCDI then buys US dollars for dividends deposited into US$ denominated accounts. There is a difference in the exchange rate between the dividends received from CDS and the transfer to individual accounts. This results in the small discrepancy between dividends declared and dividends received.
The result is for 1,000 shares of BIP
BIP declared dividend = US$0.43 x 1,000 shares = US$430.00
RBCDI deposited $0.429544 x 1,000 shares = US$429.54 a difference of $0.46
Sometimes it works the other way and RBCDI deposits a slightly greater amount of US$ than the equivalent original dividend amount.
Other US $ stocks do not seem to have this issue, as I mostly hold US domiciled companies in my US $ accounts. It may also be a result of how the dividend issuing company transfers funds to CDS.
It is annoying as I originally purchased BIP on the NYSE and expected to receive the declared dividend amount.
I hope this explains the matter to the reader.
Further to the reader’s question about US$ denominated dividend deposited into US$ denominated accounts at RBC Direct Investing.
I experienced the same issue with RBC Direct Investing and they explained as follows. I will use Brookfield Infrastructure
Partners (BIP) which I hold in a US$ denominated account.
BIP transfers the total dividend to Canadian Depositary for Securities (CDS) for all the BIP shares held by CDS (in excess of 100 million shares) on behalf of Canadian Brokers. This dividend payment (in US $) is converted to C$ (unclear whether its BIP or CDS) at “wholesale” rates.
CDS then transfers to each Canadian Broker (i.e. RBCDI) the Canadian dollar equivalent of BIP dividends held by the individual brokers (i.e. RBCDI). RBCDI then buys US dollars for dividends deposited into US$ denominated accounts. There is a difference in the exchange rate between the dividends received from CDS and the transfer to individual accounts. This results in the small discrepancy between dividends declared and dividends received.
The result is for 1,000 shares of BIP
BIP declared dividend = US$0.43 x 1,000 shares = US$430.00
RBCDI deposited $0.429544 x 1,000 shares = US$429.54 a difference of $0.46
Sometimes it works the other way and RBCDI deposits a slightly greater amount of US$ than the equivalent original dividend amount.
Other US $ stocks do not seem to have this issue, as I mostly hold US domiciled companies in my US $ accounts. It may also be a result of how the dividend issuing company transfers funds to CDS.
It is annoying as I originally purchased BIP on the NYSE and expected to receive the declared dividend amount.
I hope this explains the matter to the reader.
