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.

The preferreds (NYSE: BACPrB) were down 26 cents to close at $26.13 with about 408,000 shares in volume.

Meanwhile, First Republic Bank’s recent series I noncumulative perpetual preferred stock dropped more than 1%.

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.

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