Morning Commentary: OM Asset Management bringing $25-par notes; Capital One deal frees to trade

By Stephanie N. Rotondo

Seattle, July 27 – The preferred stock primary market continued to churn out new issues on Wednesday, with “a small deal” hitting the tape, according to a trader.

OM Asset Management plc announced an offering of $100 million $25-par senior notes due 2031.

Price talk is in the 5.25% area, a market source said.

A trader had not yet seen markets for the new issue.

BofA Merrill Lynch, Wells Fargo Securities LLC and Citigroup Global Markets Inc. are acting as bookrunners.

However, Capital One Financial Corp.’s $600 million of 5.2% series G noncumulative preferreds – a deal priced Tuesday – were seen trading up to par, a trader said.

The trader noted that the paper had freed to trade as of mid-morning.

The deal came tight to the 5.37% to 5.5% talk and was upsized from $250 million. BofA Merrill Lynch, J.P. Morgan Securities LLC, Morgan Stanley & Co. LLC, UBS Securities LLC and Wells Fargo ran the books.

As for Bank of New York Mellon Corp.’s $1 billion of 4.625% $1,000-par series F fixed-to-floating rate noncumulative preferreds, those continued to trade just north of par.

That issue came Monday via BofA Merrill Lynch, Citigroup, Morgan Stanley, UBS Securities and BNY Mellon Capital Markets LLC.

Away from recent deals, Deutsche Bank AG’s trust preferreds were in decline after the company reported weak earnings.

The 7.6% TruPs (NYSE: DTK) were off 9 cents at mid-morning, trading at $26.09. The 8.05% TruPs (NYSE: DKT) were down 15 cents at $25.08.

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