PNC Financial upsizes $1,000-par new issue, prices at revised talk; People’s United eyed

By Stephanie N. Rotondo

Seattle, Oct. 27 – Despite ongoing weakness in the preferred stock market, the primary space continued to push out new deals on Thursday.

PNC Financial Services Group Inc. announced a sale of $1,000-par series S fixed-to-floating rate noncumulative perpetual preferreds. The $525 million deal came upsized from $500 million and at par to yield 5%.

Initial price talk was 5.125% but was later downwardly revised, according to a market source.

J.P. Morgan Securities LLC, Citigroup Global Markets Inc., Morgan Stanley & Co. LLC and PNC Capital Markets LLC ran the books.

Market sources saw few markets for the new issue. However, the 6.125% series P fixed-to-floating rate noncumulative preferreds (NYSE: PNCPP) were on the active side, falling 35 cents, or 1.23%, to $28.20.

While fixed, dividends will be paid semiannually. Once floating – at Libor plus 330 basis points, beginning Nov. 1, 2026 – the dividend will be paid on a quarterly basis.

The preferreds are redeemable on or after Nov. 1, 2026 or within 90 days of a regulatory capital treatment event at par plus accrued dividends.

As for the week’s other new deals, People’s United Financial Inc.’s $250 million issue of 5.625% $25-par series A fixed-to-floating rate noncumulative preferreds continued to trade at a significant premium.

A trader quoted the issue at $26.18 bid, $26.30 offered.

The deal came Monday and upon pricing, immediately jumped well over par.

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