Morning Commentary: SoCal Edison’s 5.375% trust securities pop; Capital One preferreds get a symbol

By Stephanie N. Rotondo

Phoenix, Aug. 18 – New preferred stock issues from Monday’s business were doing well on Tuesday.

A trader said both Southern California Edison Co.’s SCE Trust IV $325 million of 5.375% fixed-to-floating rate trust preference securities and Capital One Financial Corp.’s $500 million of 6.2% fixed-rate series F noncumulative preferreds had freed to trade early in the session.

As for the Southern California Edison deal, he quoted the preferreds at $25.25 bid, $25.27 offered.

“It’s an investment-grade name,” he said. “A lot of insurance companies like to hold utilities, since they can only hold so many financials.”

Morgan Stanley & Co. LLC, J.P. Morgan Securities LLC, RBC Capital Markets, BNY Mellon Capital Markets LLC and BNP Paribas Securities Corp. ran the books on the new issue.

When declared, distributions will be payable quarterly at a fixed rate until Sept. 15, 2025, when the distribution rate will begin to float at Libor plus 313.2 basis points.

In the Capital One preferreds, those were seen at $24.90 bid, $24.92 offered.

Those shares were also assigned a temporary ticker symbol on Tuesday. The ticker is “CPTFP.”

The deal was upsized from $250 million. Initial price talk was in a 6.25% to 6.375% range. That was then revised to 6.2% to 6.25%.

BofA Merrill Lynch, JPMorgan, Morgan Stanley, UBS Securities LLC and Wells Fargo Securities LLC ran the books.

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