Preferreds continue to gain strength; SoCal Edison issue lists; National Bank of Greece rises

By Stephanie N. Rotondo

Portland, Ore., May 22 - Preferred stocks continued to gain traction in Tuesday trading, a trader reported.

However, he also speculated that the market could remain "range bound" leading up to an election in Greece.

"We could be in for a rollercoaster or a slow grind higher," he said.

In recent issues, the 5.625% perpetual cumulative trust preference securities issued by Southern California Edison Co.'s SCE Trust I listed on the New York Stock Exchange. But the listing did little to propel the securities higher.

Meanwhile, National Bank of Greece SA's preferreds got a more than 5% boost on the day on news the bank will soon receive more bailout capital.

The week's new issue calendar has been lackluster thus far, but a trader said he heard a "small deal" out of Morgan Stanley was slated to come Wednesday. The market continues to await pricing on a sale of 8.5% series A cumulative redeemable perpetual preferred stock from Resource Capital Corp.

SoCal deal lists, falters

SoCal Edison's $475 million issue of 5.625% perpetual cumulative trust preference securities listed on the NYSE Tuesday under the ticker symbol "SCEPF."

At midday, a trader said the paper was offered at $24.29.

"That was pretty cheap compared to other SoCal issues," he said.

The preferreds ended the day down 23 cents, or nearly 1%, at $24.17.

The $25-par paper priced May 10.

The Rosemead, Calif.-based power producer and subsidiary of Edison International Inc. said Thursday that it intends to use $75 million of proceeds from the new issue to redeem 750,000 shares of its variable-rate series A noncumulative preference stock.

The $100-par securities will be redeemed at par plus accrued dividends on June 16.

Protective Life to list soon

A trader said Protective Life Corp.'s new $250 million issue of 6.25% 30-year subordinated debentures will begin trading on the NYSE on Wednesday. The ticker symbol is expected to be "PLPC."

The deal priced May 15 and was upsized from $150 million.

Proceeds are being used to redeem one or more of the $100 million of 7.5% trust originated preferred securities due 2031 issued by PLC Capital Trust III, the $115 million of 7.25% trust originated preferred securities due 2032 issued by PLC Capital Trust IV and the $200 million of 7.25% capital securities due 2066 issued by Protective Life.

Protective Life provides financial services, insurance and investment products and is based in Birmingham, Ala.

Greek bank boosted

National Bank of Greece's 9% series A noncumulative preference shares (NYSE: NBGPA) climbed more than 5% in Tuesday trading following news the bank will soon receive more bailout capital.

The preferreds gained 15 cents, or 5.28%, and closed at $2.99.

Last week, Greece received €25 billion from the European Financial Stability Facility. This week, the country will pump €18 billion into its four largest banks, including National Bank of Greece.

The increase in capital will help the banks raise funds and increase their capital cushions, but it will continue to limit their ability to lend.

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