Preferreds end week lower; HSBC, ING, Barclays under pressure; Bank of America, Ally down

By Stephanie N. Rotondo

Portland, Ore., Aug. 19 - Preferred stocks were "quietly bleeding," a trader said Friday.

"Everything was down, but not horrendously so," he added.

"Things started on a bad note, then they got better, then it got bad again," said another market source. However, late in the day he said there was a modest rally, possibly due to short covering ahead of the weekend.

"Things are largely responding to Europe," the source said.

"There is more pressure on foreign [issuers] than U.S.," the first trader noted. As such, names like HSBC Holdings plc, ING Groep NV and Barclays Bank plc got weighed down.

Royal Bank of Scotland Group plc and National Bank of Greece SA were among the day's biggest losers on a percentage basis.

Meanwhile, a trader said Bank of America Corp. paper was "selling off," while other major banks - JPMorgan & Chase Co., Well Fargo LLC - were "not moving at all."

Ally Financial Inc. was also weaker and among the day's most actively traded securities.

Foreign issuers drop

Fears of the euro-contagion pushed foreign banks and insurers even lower as the week rounded out.

HSBC's 8% exchangeable perpetual subordinated capital securities (NYSE: HCSPB) were one of the busiest issues of the day, with more than 643,000 shares turning over. The preferreds fell 43 cents, or 1.63%, to $25.99.

Barclays' 8.125% non-cumulative callable dollar preference shares, series 5, (NYSE: BCSPD) were also active. The preferreds traded down 9 cents to $23.98 on volume of about 633,330 shares.

In the ING structure, the 8.5% perpetual hybrid capital securities (NYSE: IGK) were the most active, falling a dime to $23.48.

RBS and National Bank of Greece were the day's biggest percentage losers, according to a market source. RBS' 6.6% non-cumulative dollar preference shares, series S, (NYSE: RBSPS) dropped 88 cents, or 6.48%, to $12.69. National Bank of Greece's 9% series A preferreds (NYSE: NBGPA) meanwhile lost 37 cents, or 5.76%, to $6.05.

BofA, Ally decline

Though pressure on the U.S. banks was not as much as on foreign issuers, that didn't stop Bank of America and Ally Financial's preferreds from losing ground.

Bank of America's 8.2% series H depositary shares (NYSE: BACPH) slipped 31 cents to $22.90, while the 8.625% series Qs tied to Merrill Lynch (NYSE: BMLPQ) declined 26 cents to $23.53.

Ally's 8.5% series A preferreds (NYSE: ALLYPA) were the most active issue of the day, with some 2.77 million shares changing hands. The preferreds dipped 15 cents to $19.65.

The 8.125% series Bs (NYSE: ALLYPB) were also busy, with volume of about 866,600 shares. The stock dropped a nickel to $18.78.

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