Preferreds see strong start to May trading; primary awaits new deals; oil weighs on sector

By Stephanie N. Rotondo

Seattle, May 2 – The preferred stock market was on the rise in Monday trading, kicking off the new month with a firm tone.

The Wells Fargo Hybrid and Preferred Securities index rose 30 basis points, or about 7.5 cents for $25-par paper. The index was up 9 bps at mid-morning.

A trader said that while there continued to be buzz about the possibility of a couple new deals this week, he had yet to see any further details.

Among the more recent deals, Bank of America Corp.’s $900 million of 6% series E noncumulative preferreds (NYSE: BACPA) and Customers Bancorp Inc.’s $50 million of 6.45% series E fixed-to-floating rate noncumulative perpetual preferred stock (NYSE: CUBIPE) continued to make the most-active list – though liquidity overall was a bit subdued.

Bank of America’s preferreds were up 3 cents at $25.27. Customers Bancorp’s preferreds were up a like amount at $25.11.

Meanwhile, Legacy Reserves LP’s 8% series B fixed-to-floating rate cumulative redeemable perpetual preferred units (Nasdaq: LGCYO) were down 83 cents, or 13.45%, at $5.34. The 8% series A fixed-to-floating rate cumulative redeemable perpetual preferred units (Nasdaq: LGCYP) were off 93 cents, or 15.05%, at $5.25.

Breitburn Energy Partners LP’s 8.25% series A cumulative redeemable perpetual preferred units (Nasdaq: BBEPP) were meantime seen falling 16 cents, or 7.48%, to $1.98.

The securities are not paying distributions.

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