Midday Commentary: AmTrust Financial bounces back; Deutsche Bank preferreds active in trading

By Christine Van Dusen

Atlanta, Dec. 13 - AmTrust Financial Services Inc. remained in focus on Friday morning as its 6¾% series A noncumulative preferreds (AFSIPA) managed to bounce back after the previous day's beating, a trader said.

GeoInvesting, an online provider of research, issued a report Thursday that alleged AmTrust was using discrepancies in United States and Luxembourg accounting practices to avoid disclosing certain losses to the Securities and Exchange Commission. The website also claimed the company was tinkering with valuations on life-settlement contracts.

New York-based AmTrust, however, issued a statement denying the claims. And late on Thursday, two directors bought 200,000 shares each of the common stock, which helped the name recover in the market.

In other trading among preferreds on Friday, Deutsche Bank Contingent Capital Trust V's 8.05% trust preferred securities were the most active, trading at $27.32, down about 2 cents on volume totaling 113,557.

Deutsche Bank Contingent Capital Trust III's 7.6% trust preferred securities were also active, trading at $26.13, up 5 cents on volume totaling 52,141.

Wells Fargo & Co.'s $750 million offering of 6.625% series R class A fixed-to-floating rate noncumulative perpetual preferred stock was spotted Friday at about $25.05.

That's flat to the level seen Thursday, when the issue was first free to trade, the trader said.

"It's pretty quiet going into the holiday week," he said. "It's going to just taper down until year-end. Once we get this budget passed, that will give some confidence that we're not going to have to shut down the government. That will give some people encouragement to try to focus on investments."

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