By Stephanie N. Rotondo
Portland, Ore., May 24 - First Republic Bank priced a $150 million sale of 6.2% series B noncumulative perpetual preferred stock, traders confirmed Thursday.
Price talk was originally 6.25% to 6.375% but was later revised to 6.25%, according to a trader. Around midday, the trader further opined that talk "may even go lower."
Morgan Stanley & Co. LLC, Bank of America Merrill Lynch and J.P. Morgan Securities LLC are the joint bookrunners.
The liquidation preference is $1,000 per preferred. The securities (Baa3/BBB) will be issued as $25-par depositary shares each representing 1/40th of an interest in a preferred.
Dividends are payable quarterly when and if declared by the board of directors. The payments will come on March 30, June 30, Sept. 30 and Dec. 30 beginning June 29.
The San Francisco-based bank has the option to redeem the preferreds beginning in May 2017 or at any time in the event of a regulatory capital treatment event.
First Republic has applied to list the new preferreds on the New York Stock Exchange under the ticker symbol "FRCPB." Settlement is expected June 1.
Proceeds will be used for general corporate purposes, which may include funding loans or purchasing investment securities. The offering will also increase the bank's tier I capital, allowing it to offset a possible redemption of First Republic Preferred Capital Corp.'s 7.25% series D noncumulative perpetual preferred stock.
| Issuer: | First Republic Bank
|
| Issue: | Series B noncumulative perpetual preferred stock
|
| Amount: | $150 million
|
| Maturity: | Perpetual
|
| Dividend: | 6.2%
|
| Price: | Par of $25 per depositary share
|
| Call option: | Beginning in May 2017 or upon a regulatory capital treatment event
|
| Bookrunners: | Morgan Stanley & Co. LLC, Bank of America Merrill Lynch and J.P. Morgan Securities LLC
|
| Pricing date: | May 24
|
| Settlement date: | June 1
|
| Ratings: | Moody's: Baa3
|
| Standard & Poor's: BBB
|
| Expected listing: | NYSE: FRCPB
|
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