Morning Commentary: Customers Bancorp, Ford to tap $25-par market; Fortress lower

By James McCandless

San Antonio, Dec. 4 – The preferred space began the day positive with the Wells Fargo Hybrid & Preferred Securities Financial index up by 0.15%.

In primary activity, Customers Bancorp, Inc. plans to sell a $35 million offering of $25-par subordinated notes due Dec. 30, 2024 with a coupon in the 5.5% area.

B. Riley FBR, Inc., D.A. Davidson & Co. and Janney Montgomery Scott LLC are the joint bookrunners.

Coupons are payable on March 30, June 30, Sept. 30 and Dec. 30 of each year, commencing on March 30, 2020.

The notes are redeemable on or after Dec. 30, 2029 at par. Prior to that, the notes are redeemable after a tax event, a tier 2 capital event or if the company is required to register as an investment company.

Also, Ford Motor Co. announced plans to price a $250 million offering of $25-par notes due Dec. 1, 2059 with a coupon in the 6.125% area.

BofA Securities, Inc., Morgan Stanley & Co. LLC, RBC Capital Markets, LLC, Wells Fargo Securities, LLC, Citigroup Global Markets Inc. and J.P. Morgan Securities LLC are the joint bookrunners.

Coupons are payable on March 1, June 1, Sept. 1 and Dec. 1 of each year, beginning March 1, 2020.

The notes are redeemable on or after Dec. 1, 2024 at par.

Leading in the secondary, Fortress Transportation & Infrastructure Investors LLC’s 8% series B fixed-to-floating rate cumulative perpetual redeemable preferred shares were under water early.

The preferreds (NYSE: FTAIPrB) were down 4 cents to $25.28 on volume of about 228,000 shares.

Meanwhile, in the finance space, AXA Equitable Holdings, Inc.’s 5.25% series A fixed-rate non-cumulative perpetual preferred stock was also losing ground.

The preferreds (NYSE: EQHPrA) were off 10 cents to $24.85 with about 131,000 shares trading.

Sector peer SVB Financial Group’s new 5.25% series A fixed-rate non-cumulative perpetual preferreds followed the trend of top traders.

The preferreds, trading under the temporary symbol “SIVBL,” were falling 20 cents to $25.25 on volume of about 94,000 shares.

Capital One Financial Corp.’s 5% series I fixed-rate non-cumulative perpetual preferred stock was seen improving.

The preferreds (NYSE: COFPrI) were gaining 4 cents to $24.77 with about 57,000 shares trading.

Elsewhere, communications name Qwest Corp.’s 6.5% notes due 2056 were relatively active but flat.

The $25-par notes (NYSE: CTBB) were unchanged at $24.84 on volume of about 82,000 notes.

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