Morning Commentary: Recently priced deals remain in play; OM notes not yet free; Deutsche dips

By Stephanie N. Rotondo

Seattle, July 28 – The preferred stock primary market took a breather on Thursday after pushing out a few deals earlier in the week.

From Wednesday’s business, OM Asset Management plc’s $125 million of 5.125% $25-par senior notes due 2031 were seen offered at $24.92 in early trading.

“They have been trading right around that $24.90 area,” a trader said, adding that the deal had not yet freed from the syndicate.

The deal came upsized from $100 million and tighter than the 5.25% area talk. BofA Merrill Lynch, Wells Fargo Securities LLC and Citigroup Global Markets Inc. ran the books.

From Tuesday, Capital One Financial Corp.’s $600 million of 5.2% series G noncumulative preferreds were “sitting around par, $25.02,” according to a trader.

That issue came tight to the 5.37% to 5.5% talk and was upsized from $250 million. BofA, J.P. Morgan Securities LLC, Morgan Stanley & Co. LLC, UBS Securities LLC and Wells Fargo led the deal.

Deals from earlier in the month also remained in focus. Dominion Resources Inc.’s $800 million of 5.25% 2016 series A $25-par enhanced junior subordinated notes due 2076 (NYSE: DRUA) – a deal priced July 12 – were ticking up 4 cents in early trading to $25.20. Public Storage’s $300 million of 4.95% series D cumulative preferreds (NYSE: PSAPD) were meantime holding around the $24.99 area.

That issue came July 13.

Aside from new and recent issues, Deutsche Bank AG paper remained weak following the German bank’s earnings release on Wednesday, in which the company reported a 19% decline in net revenue.

The 7.6% trust preferred securities (NYSE: DTK) dropped 6 cents to $25.66. The 8.05% TruPs (NYSE: DKT) were off 12 cents at $25.95.

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