Midday Commentary: DDR, Aegon announce redemptions, trade lower; BofA miscalculates reserves

By Stephanie N. Rotondo

Phoenix, April 28 - Preferred stocks were getting off to a rough start on Monday as the Wells Fargo Hybrid and Preferred Securities index dipped 9 basis points as of mid-morning.

A trader also noted that there were no new deals announced, though he said he was expecting some this week.

Redemptions were the focus of the session as DDR Corp. called its remaining $55 million of 7.375% class H cumulative redeemable preferreds (NYSE: DDRPH) and Aegon NV said it was redeeming all of its 7.25% perpetual capital securities (NYSE: AEF).

The DDR preferreds were off just a penny on the news, trading around $25.31. However, Aegon's preferreds were down over 1%, losing 34 cents to trade at $25.40.

Elsewhere in the secondary market, Bank of America Corp.'s "preferreds were fine, its common was down," a trader said, as the bank said that it would have to halt a stock buyback and dividend increase due to a miscalculation of its capital reserves.

The bank's various preferred shares were trading mixed as of mid-morning.

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