Morning Commentary: Banc of California steady, not yet free; new deal rumored; Citigroup trades off

By Stephanie N. Rotondo

Seattle, Feb. 2 – Preferred stocks were softening as Tuesday’s session got underway.

“Things are off, but not by a lot,” a trader said.

The Wells Fargo Hybrid and Preferred Securities index was down 14 basis points at mid-morning.

Banc of California Inc.’s 7% series E noncumulative perpetual preferreds – a deal priced Monday – were “still floating around” $24.75, according to a trader.

The issue – which came via BofA Merrill Lynch and UBS Securities LLC – had not freed to trade by mid-morning.

The new securities came on the heels of rumors of a deal from a regional bank. On Tuesday, those same rumors were circulating, according to the trader.

“This was going to be an [investment-grade] bank in the 5.5% area,” he said, “which makes me think BB&T or PNC.”

Still, he hadn’t seen anything announced as of mid-morning.

Meanwhile, Citigroup Inc.’s 6.3% series S noncumulative preferreds were trading “off a little bit” in a $25.05 to $25.12 context, the trader said.

“They were more like $25.25 the other day,” the trader said.

The preferreds came Jan. 26, with $900 million shares being sold. On Monday, a market source reported that the greenshoe was exercised, lifting total issuance to $1.35 billion.

The paper is trading under a temporary ticker, “CTGGP.”

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.