Morning Commentary: Preferreds begin week with firm tone; RAIT plans $25-par baby bond sale

By Stephanie N. Rotondo

Phoenix, Aug. 11 – A preferred stock trader said early Monday that “everything is kind of ticking up a little bit.”

The Wells Fargo Hybrid and Preferred Securities index was up 17 basis points at mid-morning.

RAIT Financial Trust added a new issue to the calendar, launching an offering of at least $35 million of $25-par senior notes due 2019.

Price talk is around 7.25%, according to a trader, who added that the deal could grow.

“It’s a nice piece of paper,” the trader said of the five-year maturity, which is non-callable for three years. “It should do well.”

He saw a $24.85 gray market for the paper early in the day.

The Philadelphia-based real estate investment trust’s 7.625% $25-par notes due 2024 (NYSE: RFT) were trading up 6 cents to $24.35.

Deutsche Bank Securities Inc., Barclays, Keefe Bruyette & Woods and Credit Suisse Securities (USA) LLC are leading the deal.

Pricing was expected later Monday.

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