Preferred market flat despite volume uptick; MVC new issue gets busy; Cullen/Frost to list

By Stephanie N. Rotondo

Phoenix, Feb. 20 - The preferred stock market picked up in volume on Wednesday, though with no fresh news or new issues to pique investors' interest.

MVC Capital Inc.'s new deal - which priced late Tuesday - was seen in early trading, but because it was a small deal - only $70 million of the 7.25% $25-par senior notes due 2023 were sold - there wasn't much action.

A trader quoted the issue at $24.50 bid, $24.62 offered.

The trader said he was not sure if the deal had freed up but remarked that because the issue was "that small, it seems like something that would immediately free, because it's so tiny."

Another market source said the issue had in fact freed up, noting that it was one of the day's most actively traded securities, with about 794,000 shares changing hands.

The source said the preferreds ended the day flat at $24.79.

In other recent issues, Cullen/Frost Bankers Inc.'s $150 million of 5.375% series A noncumulative perpetual preferreds are expected to hit the New York Stock Exchange on Thursday.

The ticker symbol is "CFRPA." The deal priced Feb. 12.

A market source said that paper was also active, with about 426,000 shares trading. The preferreds ended the day up 8 cents at $24.60.

Overall, the market was deemed "largely flat again," by one market source. However, he added that volume had improved from Tuesday's session, though the new issue market remained quiet. He speculated that a "big school holiday" in the Northeast was likely keeping some people from their desks, thus the lack of new issue activity.

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