Morning Commentary: First Republic Bank adds deal to pipeline; Customers Bancorp admitted to NYSE

By Stephanie N. Rotondo

Phoenix, May 19 – Preferred stocks remained under pressure in early Tuesday trading.

The Wells Fargo Hybrid and Preferred Securities index was off 16 basis points at mid-morning.

Despite the day’s weak start, First Republic Bank announced an offering of series F noncumulative perpetual preferreds.

A trader said he was hearing price talk around 5.75%, though he noted that it was not confirmed.

He saw an early gray market quote of $24.70 bid, $24.92 offered.

BofA Merrill Lynch, Morgan Stanley & Co. LLC and Wells Fargo Securities LLC are running the deal.

Ahead of the new issue’s pricing, the bank’s 5.5% series D noncumulative perpetual preferreds (NYSE: FRCPD) were trading down 4 cents at $24.39.

Meanwhile, Customers Bancorp Inc.’s $50 million of 7% series C fixed-to-floating rate noncumulative perpetual preferred stock listed on the New York Stock Exchange on Tuesday, according to a market source.

The deal came May 11. The ticker symbol is “CUBIPC.”

Paper was trading at $25.35 at mid-morning, up from opening levels of $25.33.

Morgan Stanley & Co. LLC and UBS Securities LLC were the bookrunners for the Securities and Exchange Commission-registered deal.

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