Preferreds soften; Citigroup, American Financial see some activity; Nuveen deal in focus

By Christine Van Dusen

Atlanta, Nov. 12 – The preferred stock market was slightly softer on Thursday, alongside equities, while recent issues from Citigroup Inc. and American Financial Group Inc. stayed fairly flat.

Citigroup’s 6.125% $1,000-par series R fixed-to-floating rate noncumulative perpetual preferred stock was quoted at 100.375 on Thursday after trading Wednesday at 100.25, a trader said.

Citigroup came to the market a week ago. Proceeds will be used for general corporate purposes, which may include funding subsidiaries, financing acquisitions or growth or refinancing or extending the maturities of outstanding debt.

American Financial Group’s 6% $25-par subordinated debentures due 2055 traded Thursday at par.

The debentures were “a little softer than yesterday,” he said.

In other news, Nuveen Short Duration Credit Opportunities Fund has priced $35 million of series 2020 term preferred shares with an initial dividend rate of 1.5% at par of $1,000, the company said in a filing with the Securities and Exchange Commission on Monday.

Morgan Stanley & Co. LLC is underwriting the deal.

Dividends will be payable monthly. The dividend starts at 1.5% and then steps up on Nov. 1, 2017 to 1.75%. On May 1, 2018, the rate increases to 2%, then 2.5% on Nov. 1, 2018, 3.5% on May 1, 2019 and 4% on Nov. 1, 2019.

The rate ends at 5% on May 1, 2020 through the maturity.

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