Huntington taps $25-par market; Prospect Capital on deck; Truist preferreds positive

By James McCandless

San Antonio, Aug. 3 – As the Monday session came to an end, the preferred market saw overall negativity while top traders differed.

In primary maneuvers, Huntington Bancshares Inc. priced a $500 million offering of $1,000-par series G non-cumulative perpetual preferred stock with a dividend of 4.45%.

Also, Prospect Capital Corp. started a $1 billion continuous $25-par preferred stock offering of up to 40 million shares with a dividend of 5.5%.

Leading the secondary market, Truist Financial Corp.’s new 4.75% series R non-cumulative perpetual preferred stock was positive.

Elsewhere in the finance space, Wells Fargo & Co.’s 4.75% series Z non-cumulative perpetual class A preferred stock improved.

Sector peer Ally Financial Inc.’s 8.125% series 2 fixed-to-floating rate trust preferred securities jumped higher.

Meanwhile, REIT Armada Hoffler Properties, Inc.’s 6.75% series A cumulative redeemable perpetual preferreds dived.

Pennsylvania REIT’s 7.2% series C cumulative redeemable perpetual preferred shares were also seen sliding.

Huntington prices

In primary space maneuvers, Huntington priced a $500 million offering of $1,000-par series G non-cumulative perpetual preferred stock (Baa3/BB+/BB+) with a dividend of 4.45%.

The deal, announced Monday morning, was upsized from an initial $350 million and came in under talk of a dividend in the 4.75% to 4.875% area.

BofA Securities, Inc., Goldman Sachs & Co. LLC, Morgan Stanley & Co. LLC, RBC Capital Markets, LLC and Huntington Securities, Inc. are the bookrunners.

The dividend resets on Oct. 15, 2027 to the seven-year Treasury rate plus 404.5 basis points.

The preferreds are redeemable on any dividend payment date or after the first reset date or within 90 days of a regulatory capital treatment event at par.

Prospect on tap

Also, Prospect Capital started a $1 billion continuous $25-par preferred stock offering of up to 40 million shares with a dividend of 5.5%.

Preferred Capital Securities, LLC is the dealer manager.

Dividends are payable monthly.

Truist up

Leading the day’s secondary market, Truist’s new .75% series R non-cumulative perpetual preferred stock was positive.

The preferreds, trading under the temporary symbol “TSTFL,” were up 7 cents to close at $25.27 on volume of about 1.8 million shares.

On Friday, the preferreds closed below par.

Elsewhere in the finance space, Wells Fargo’s 4.75% series Z non-cumulative perpetual class A preferred stock improved.

The preferreds (NYSE: WFCPrZ) picked up 25 cents to close at $24.65 with about 392,000 shares trading.

Sector peer Ally Financial’s 8.125% series 2 fixed-to-floating rate trust preferred securities jumped higher as the afternoon concluded.

The preferreds (NYSE: ALLYPrA) jumped up 57 cents to close at $24.64 on volume of about 384,000 shares.

On Friday, the preferreds gained 12 cents.

Armada Hoffler dives

Meanwhile, real estate investment trust Armada Hoffler’s 6.75% series A cumulative redeemable perpetual preferreds dived.

The preferreds (NYSE AHHPrA) crashed $1.42 to close at $26.06 with about 709,000 shares trading.

Pennsylvania REIT’s 7.2% series C cumulative redeemable perpetual preferred shares were also seen sliding by the end of activity.

The preferreds (NYSE: PEIPrC) dropped $1.70 to close at $4.70 on volume of about 479,000 shares.

Indexes down

The Wells Fargo Hybrid & Preferred Securities Financial index finished the session down by 0.09%, weaker than the 0.06% rise from early Monday trading.

The iShares US Preferred Stock ETF was down 2 cents to $36.00.

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