Preferreds improve; Bank of America beats on earnings, firms; recent deals list on NYSE

By Stephanie N. Rotondo

Seattle, Oct. 17 – The new trading week started off with a slightly firm tone, due in part to better-than-expected bank earnings.

The Wells Fargo Hybrid and Preferred Securities index ended up 3 basis points, though it was up 6 bps earlier in the session.

Bank of America Corp. released its first-quarter results on Monday. Following the trend set by Wells Fargo & Co., Citigroup Inc. and J.P. Morgan Chase & Co. on Friday, the numbers beat estimates, as bond and trading revenue rose.

In response, the floating-rate series E noncumulative preferreds (NYSE: BACPE) gained a nickel to $26.41 in early trading. But like the broader market, the preferreds gave back a little bit of the gains to close up just 2 cents at $26.38.

Wells Fargo’s 6% series V class A noncumulative preferreds (NYSE: WFCPV) were also 2 cents better, closing at $26.03.

In its Friday release, San Francisco-based Wells Fargo reported earnings per share of $1.03 on revenue of $22.33 billion.

That compared to analysts’ estimates of $1.01 per share on revenue of $22.21 billion.

Total average loans improved 7% to $957.5 million, while total average deposits increased 5% to $1.3 trillion.

However, year over year, net income fell to $5.64 billion from $5.8 billion.

Bank of America in its release on Monday showed EPS of 41 cents, compared to 38 cents the year before.

Analysts had forecast EPS of 34 cents.

Revenue was up 3% at $21.64. That compared to expectations of $20.97 billion.

The bottom line was boosted by bond trading gains. The Global Markets unit saw revenue improve 34%, with fixed-income, currency and commodities trading revenue rising 39%

New NYSE listings

Recent deals were hitting the New York Stock Exchange en masse on Monday.

Public Storage’s $350 million of 4.9% series E cumulative preferred shares hit the NYSE under the ticker “PSAPE.”

That paper was trading at $24.69 at mid-morning, which compared to $24.64 at the open. It closed at $24.61.

The deal came Oct. 6.

Also from Oct. 6, Chimera Investment Corp.’s $135 million of 8% series A cumulative redeemable preferred stock listed under the ticker “CIMPA.” That paper ended at $24.95, which compared to $24.90 at the open.

From Oct. 5, Bluerock Residential Growth REIT Inc.’s $67.5 million of 7.125% series D cumulative preferred stock began trading under the symbol “BRGPD.”

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