Morning Commentary: AGNC adds cumulative issue to primary calendar; Digital Realty lists

By Stephanie N. Rotondo

Seattle, Aug. 15 – The preferred stock new issue market continued to see a steady deal flow as AGNC Investment Corp. announced plans to sell $150 million of series C fixed-to-floating rate cumulative redeemable preferred stock.

Price talk is 7% to 7.125%, according to a market source.

The paper was seen at $24.62 bid, $24.90 offered in the early gray market.

Morgan Stanley & Co. LLC, BofA Merrill Lynch, UBS Securities LLC, J.P. Morgan Securities LLC, RBC Capital Markets LLC and Keefe Bruyette & Woods Inc. are running the books.

Meanwhile, Arch Capital Group Ltd.’s $200 million of 5.45% series F noncumulative preferreds – a deal priced Monday – had not freed to trade as of mid-morning.

A trader pegged the preferreds at $24.75 bid, $24.80 offered in the gray.

The deal came in line with revised price talk. Initial price talk was 5.5%.

The issue was also increased from an expected $150 million.

BofA Merrill Lynch, Morgan Stanley, Wells Fargo Securities LLC and JPMorgan are the bookrunners.

As for deals from earlier in the month, Digital Realty Trust Inc.’s $200 million of 5.25% series J cumulative redeemable preferred stock were admitted to the New York Stock Exchange on Tuesday under the ticker symbol “DLRPrJ.”

The preferreds were trading at $24.40 at mid-morning.

The deal priced on Aug. 2, coming tighter than the 5.375% price talk. The issue was also upsized from $100 million.

BofA Merrill Lynch, Citigroup Global Markets Inc. and Wells Fargo were the bookrunners.

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