Markel, CenterState, American Financial price; First Horizon preferreds flat; Brighthouse up

By Cristal Cody

Tupelo, Miss., May 21 – The preferred primary market remained active on Thursday with new deals.

Markel Corp. priced $600 million of perpetual rate reset non-cumulative preferred shares.

CenterState Bank Corp. sold $200 million of 10-year fixed-to-floating rate subordinated notes (Kroll: BBB) during the session.

Also, American Financial Group, Inc. brought an upsized $150 million of 40-year subordinated debentures to the primary market on Thursday.

The preferred stock primary market has been busy this week.

On Wednesday, First Horizon National Corp. priced $150 million of 6.5% $25-par perpetual non-cumulative preferred stock (Baa3/BBB/).

The company sold 6 million shares of depositary shares that represent 1/4,000th ownership interest in a share of the series E non-cumulative perpetual preferred stock.

Comerica Inc. also priced $400 million of non-cumulative perpetual fixed-rate reset preferred stock tighter than guidance following fixed income investor calls on Wednesday.

Brighthouse Financial Inc. priced an upsized $350 million offering of $25-par 6.75% perpetual series B non-cumulative preferred stock on Monday, while Truist Financial Corp. brought an upsized $500 million of 5.25% perpetual non-cumulative preferred stock to the market on Tuesday.

Additional issuance is expected from Fortress Biotech, Inc., which begin marketing an add-on to its 9.375% $25-par series A perpetual preferred stock on Tuesday.

First Horizon flat, Brighthouse rises

Preferred stocks were mostly better on the day, while new issues were mixed.

The Wells Fargo Hybrid and Preferred Securities index closed up 0.54%.

The U.S. iShares Preferred Stock ETF improved 5 cents, or 0.15%, to 34.16.

During the session, First Horizon’s 6.5% depositary shares were admitted for over-the-counter trading under the symbol “FHNCL.”

The shares were flat on the day at $24.57 on about 2.37 million shares traded.

Brighthouse Financial’s $25-par depositary shares representing the series B 6.75% perpetual series B non-cumulative preferred stock rose 16 cents, or 0.65%, to $24.89 on trading volume of nearly 275,000 shares.

The shares were admitted for trading over the counter under the symbol “BHFBL.”

In other new issue trading, Truist Financial’s $25-par depositary shares representing its 5.25% series O perpetual non-cumulative preferred stock rose 5 cents, or 0.2%, to $24.98 on trading volume of about 1.17 million shares.

Truist’s shares were admitted for over-the-counter trading under the symbol “TFCLL.”

Fortress Biotech’s 9.375% preferreds (Nasdaq: FBIOP) softened 4 cents, or 2.26%, to $18.35 on about 52,500 shares traded.

Markel prices $600 million

Markel priced $600 million of 6% perpetual rate reset non-cumulative preferred shares (Ba1/BB+/A.M. Best: bbb-) in the offering on Thursday, according to an FWP filing with the Securities and Exchange Commission.

The rate will reset on June 1, 2025 to Treasuries plus 566.2 basis points.

The company sold 600,000 shares of the preferreds at a $1,000 per share liquidation preference.

Wells Fargo Securities LLC, Citigroup Global Markets Inc. and J.P. Morgan Securities LLC were the bookrunners.

Markel is a financial holding company based in Glen Allen, Va.

CenterState brings $200 million

CenterState Bank priced $200 million of 10-year fixed-to-floating rate subordinated notes (Kroll: BBB) on Thursday at par to yield 5.75%, according to an FWP filed with the Securities and Exchange Commission.

The rate will reset June 1, 2025 to a floating rate of SOFR plus 561.7 bps.

Keefe, Bruyette & Woods, Inc. and U.S. Bancorp Investments Inc. were the bookrunners.

The bank is based in Winter Haven, Fla

American Financial upsizes

American Financial Group priced an upsized $150 million of 5.625% subordinated debentures due June 1, 2060 (Baa2/BBB-/) on Thursday, according to a market source and a news release.

Initial price talk was at the 5.75% area.

BofA Securities, Inc., Morgan Stanley & Co. LLC, UBS Securities LLC, Wells Fargo and J.P. Morgan were the bookrunners.

The offering was upsized from $100 million.

American Financial plans to apply to list the debentures on the New York Stock Exchange under the symbol “AFGD” for trading within 30 days after issuance.

American Financial Group is a Cincinnati-based holding company for property and casualty insurance subsidiaries.

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