JPMorgan taps preferred market; Qwest $25-par notes active; Northern Trust weakens

By James McCandless

San Antonio, July 25 – The preferred space saw an overall negative trend take hold in the Thursday session.

In primary activity, JPMorgan Chase & Co. priced a $2.25 billion offering of $1,000-par series FF fixed-to-floating rate non-cumulative preferred stock with an initial dividend of 5%.

The secondary saw its existing 6% series EE non-cumulative preferreds drop during the day’s trading.

Sector peer PNC Financial Services Group, Inc.’s 6.125% series P fixed-to-floating rate non-cumulative perpetual preferreds were also shifting lower.

Also in finance, Citigroup Capital XIII’s 7.875% fixed-to-floating rate trust preferred securities moved higher.

Meanwhile, in communications, Qwest Corp.’s 6.5% notes due 2056 and its 6.125% notes due 2053 diverged in trading.

Asset manager Northern Trust Corp.’s 5.85% series C non-cumulative perpetual preferred stock was weaker as the session ended.

JPMorgan’s deal

In primary activity, JPMorgan priced a $2.25 billion offering of $1,000-par series FF fixed-to-floating rate non-cumulative preferred stock with an initial dividend of 5%.

There is no greenshoe.

The deal was announced on Wednesday.

J.P. Morgan Securities LLC is the bookrunner.

The preferreds are redeemable on or after Aug. 1, 2024 at par. Prior to that time, they are redeemable within 90 days after a capital treatment event.

The dividend is fixed until Aug. 1, 2024, then converts to the three-month term SOFR plus 338 basis points.

Elsewhere, in secondary trading, the company’s existing 6% series EE non-cumulative preferreds saw a large drop during Thursday’s trading.

The preferreds (NYSE: JPMPrC) gave up 33 cents to close at $27.34 on volume of about 421,000 shares.

PNC lower

Sector peer PNC’s 6.125% series P fixed-to-floating rate non-cumulative perpetual preferreds were also seen shifting lower.

The preferreds (NYSE: PNCPrP) were down 12 cents to close at $26.93 with about 301,000 shares trading.

Also in the finance space, Citigroup’s 7.875% fixed-to-floating rate trust preferred securities moved in a positive direction.

The preferreds (NYSE: CPrN) picked up 5 cents to close at $27.87 on volume of about 297,000 shares.

Qwest diverges

Meanwhile, in the communications space, Qwest’s 6.5% notes due 2056 and its 6.125% notes due 2053 diverged in trading.

The 6.5% notes (NYSE: CTBB) fell 19 cents to close at $24.18 with about 189,000 notes trading.

On Wednesday, the notes jumped up 26 cents.

The 6.125% notes (NYSE: CTY) added 4 cents to close at $23.47 with about 185,000 notes trading.

Northern Trust weaker

Asset manager Northern Trust’s 5.85% series C non-cumulative perpetual preferred stock ended the session weaker.

The preferreds (Nasdaq: NTRSP) were down 2 cents to close at $25.37 on volume of about 175,000 shares.

Indexes down

The Wells Fargo Hybrid & Preferred Securities Financial index dived 0.40% at the close, widening from a 0.08% loss from early Thursday trading.

The iShares US Preferred Stock ETF was down 12 cents to $37.26.

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