Capital One’s new deal frees to trade; Urstadt Biddle lists on NYSE; American Realty sinks

By Stephanie N. Rotondo

Phoenix, Oct. 29 – Preferred stocks were again modestly firm in the midweek trading session, even as the Federal Reserve’s Federal Open Market Committee said that it would in fact end its bond repurchase program this month.

In a statement released Wednesday, the committee said that it was optimistic about the labor market and a declining unemployment rate. However, interest rates are being kept at near-record lows for the time being.

The Wells Fargo Hybrid and Preferred Securities index closed up 4 basis points.

The new Capital One Financial Corp. deal – a $500 million issue of 6.7% series D fixed-rate noncumulative perpetual preferred stock that priced Tuesday – had freed to trade as of early Wednesday, a trader said.

The preferreds were pegged at $25.05.

BofA Merrill Lynch, Morgan Stanley & Co. LLC, UBS Securities LLC, Wells Fargo Securities LLC and J.P. Morgan Securities LLC were the bookrunners.

The company was initially expected to sell $250 million of the preferreds at initial price talk of 6.875%.

Meanwhile, Scorpio Tankers Inc.’s $45 million of 7.5% $25-par senior unsecured notes due 2017 – another deal from Tuesday – had not yet freed up, the trader said, seeing a $24.65 bid for the notes.

Stifel, Nicolaus & Co. Inc., Jefferies Inc., Credit Suisse Securities (USA) LLC and Janney Montgomery Scott LLC ran the books on the deal, which was upsized from $25 million.

From last week’s business, Urstadt Biddle Properties Inc.’s $70 million of 6.75% series G cumulative redeemable perpetual preferreds began trading on the New York Stock Exchange.

The deal came Oct. 22. The ticker symbol is “UBPPG.”

The paper finished the day at $25.25, down from the intraday high of $25.30 but up from opening levels of $25.02.

BMO Capital Markets ran the books on that deal.

American Realty drops

American Realty Capital Properties Inc.’s 6.7% series F cumulative redeemable preferred stock (Nasdaq: ARCPP) was coming down as the company disclosed that the Securities and Exchange Commission was investigating accounting problems.

The preferreds fell $1.41, of 5.99%, to $22.16.

The issue was also very active on the day, with 3.6 million shares being exchanged.

As for the real estate investment trust’s common stock (Nasdaq: ARCP), it was off $2.38, or 19.22%, to $10.00.

In a regulatory filing on Wednesday, American Realty said that its financial statements dating back to 2013 could not be relied upon due to intentional errors and other errors that were intentionally left incorrect.

On the heels of that news, the company also disclosed that chief financial officer Brian Block and chief accounting officer Lisa McAlister had resigned from their posts.

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