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Energy Transfer taps market; Bank of America preferreds fall; First Republic slips
By James McCandless
San Antonio, July 16 – The start of the week in the preferred market saw broad declines on Monday.
Energy Transfer Partners, LP’s 7.375% series C fixed-to-floating rate cumulative redeemable perpetual preferred units sank following the sale of $400 million of new series D fixed-to-floaters on Monday.
Bank of America Corp.’s 6% series GG non-cumulative preferred stock also fell.
Meanwhile, First Republic Bank’s recent series I noncumulative perpetual preferred stock dropped more than 1%.
Energy Transfer prices
Energy Transfer sold $400 million of 7.625% series D fixed-to-floating rate cumulative redeemable perpetual preferred units at par of $25.00 on Monday, according to an FWP filing with the Securities and Exchange Commission.
There is a $60 million, or 2.4 million share, over-allotment option.
Beginning Aug. 15, 2023, the preferreds convert to a floating rate equal to Libor plus 473.8 basis points.
Joint bookrunners were J.P. Morgan Securities LLC, BofA Merrill Lynch, Morgan Stanley & Co. LLC, RBC Capital Markets LLC and Wells Fargo Securities LLC.
The company’s older 7.375% series C fixed-to-floating rate cumulative redeemable perpetual preferred units lost 1.38% of their value after the offering of series D preferreds was announced.
The series C preferreds (NYSE: ETPPrC) were down 35 cents to close at $25.00 with about 1,046,000 shares trading.
Bank of America slides
Bank of America’s 6% series GG non-cumulative preferred stock declined, reversing the gains experienced Friday.
The preferreds (NYSE: BACPrB) were down 26 cents to close at $26.13 with about 408,000 shares in volume.
On Friday, the preferreds were up 2 cents.
First Republic down
First Republic’s 5.5% series I noncumulative perpetual preferred stock also saw losses on Monday.
The preferreds (NYSE: FRCPrI) were down 27 cents to close at $24.73 with about 302,000 shares trading.
Indexes down
The Wells Fargo Hybrid & Preferred Securities Financial index was down 0.40% at market close, widening from the 0.30% decline in early trading on Monday.
The iShares US Preferred Stock ETF was down 7 cents to $37.60.
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