Preferred primary picks up; Farm Credit Bank sells $100-par deal; Wells Fargo frees up

By Stephanie N. Rotondo

Phoenix, July 16 - The preferred stock primary market was returning to normal on Tuesday, a trader said, as more deals were starting to add to the calendar.

Box Ships Inc. announced plans to offer series C cumulative redeemable perpetual preferreds. A trader said price talk was around 9%.

"They will probably walk that one around for about a week before they price it," he speculated.

Meanwhile, price talk emerged on WhiteHorse Finance Inc.'s proposed offering of at least $30 million of $25-par senior notes.

The deal was originally announced July 10.

Price talk on that deal was around 6.5%, according to the trader.

"That's kind of crazy; I don't want to touch it there," he said, adding that pricing should come either later Tuesday or Wednesday.

And, Farm Credit Bank of Texas was said to be shopping a Rule144A offering of fixed-to-floating rate class B series 2 noncumulative perpetual preferreds.

Price talk was 6.75%. The dividend begins floating at Libor plus a spread on Sept. 15, 2023.

After the close, a market source said $300 million of the $100-par preferreds were sold in line with price talk at 6.75%.

From Monday business, Wells Fargo & Co.'s $1.5 billion of 5.85% series Q class A fixed-to-floating rate noncumulative preferreds were "doing well," a trader said.

He pegged the issue around par at midday.

After the bell, another source said the issue was "bid around par for most of the day," seeing a $25.02 bid for paper.

The new deal freed to trade on Tuesday.

In the secondary, Bank of America Corp.'s 7.25% series J noncumulative preferreds (NYSE: BACPJ) were by far the most actively traded securities, with over 2.8 million shares changing hands.

The issue - which has been called for redemption on Aug. 1 - traded up a penny to par.

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