The Bank of Nova Scotia filed a free writing prospectus on October 29, 2026, describing a preliminary offering of Step Income Securities linked to the common stock of CrowdStrike Holdings, Inc., carrying an 18.00% per year interest rate and a term of approximately one year and one week.

Key Highlights

  • Interest rate: 18.00% per year, payable quarterly, according to the filing.
  • Principal amount: $10.00 per unit, with up to 100.00% of principal at risk on the downside.
  • Step Level: 118.00% of the starting value of the underlying stock (CrowdStrike Holdings, Inc., Bloomberg symbol: CRWD UW).
  • Step Payment: A preliminary range of $0.10 to $0.50 per unit, representing a 1.00% to 5.00% return over principal, to be set on the pricing date.
  • Threshold Value: 100.00% of the starting value, meaning any decline in the underlying stock results in 1-to-1 downside exposure.
  • No exchange listing: The filing states the notes will not be listed on any exchange.
  • Registration: Filed pursuant to Rule 433 under Registration Statement No. 333-298611.

Structure and Risk Profile of the CrowdStrike-Linked STEPS Offering

According to the filing, the Bank of Nova Scotia is offering Step Income Securities (STEPS) linked to the common stock of CrowdStrike Holdings, Inc. The notes carry a principal amount of $10.00 per unit and a term of approximately one year and one week. Interest accrues at 18.00% per year and is payable quarterly. The filing describes these as structured notes, not direct equity investments, and the filing notes that holders "will have no rights of a holder of the Underlying Stock" and will not receive shares, dividends, or other distributions from CrowdStrike.

At maturity, the payout structure disclosed in the filing works as follows: if the underlying stock is at or above 118.00% of its starting value (the Step Level), investors receive a Step Payment in the preliminary range of $0.10 to $0.50 per unit. If the stock finishes below 100.00% of its starting value (the Threshold Value), investors face 1-to-1 downside exposure with up to 100.00% of principal at risk. Final terms, including the exact Step Payment, will be determined on the pricing date.

The filing identifies several key risks. Payments on the notes are subject to the credit risk of BNS, and the filing states that "if BNS becomes insolvent or is unable to pay its obligations, you may lose your entire investment." The filing also discloses that "the initial estimated value of the notes on the pricing date will be less than their public offering price," and that selling the notes prior to maturity may result in proceeds below both the public offering price and the initial estimated value. The Redemption Amount will not be adjusted for all corporate events affecting the underlying stock.

What Was Disclosed

The Bank of Nova Scotia filed a free writing prospectus for preliminary STEPS notes linked to CrowdStrike Holdings common stock, offering 18.00% annual interest, a Step Level of 118.00%, a preliminary Step Payment range of $0.10 to $0.50 per unit, and full downside principal risk with no exchange listing.