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Published on 4/27/2011 in the Prospect News Investment Grade Daily.

M&T Bank to issue new preferreds; Ally dips as dividend paid; Citigroup slips, RBS gains

By Stephanie N. Rotondo

Portland, Ore., April 27 - The preferred stock market was mostly mixed Wednesday, though more toward the positive side, according to a market source.

Still, total trading in the preferred space was well below Tuesday's levels. Nearly $480 million face value of preferreds changed hands, compared with about $722 million on Tuesday.

"I was hoping we'd see some action with the Fed doing nothing," a trader said, referring to the Federal Reserve's decision to maintain its course after its two-day meeting.

The trader also noted that many preferred investors are looking to buy securities that are to be called or mature in 2013, when the Frank-Dodd bill becomes effective.

"But we don't expect anything much to happen for the next quarter or so because everyone is still trying to figure out what will go on with the new financial regulations," he said.

That being said, he also remarked that he heard rumors of new issues that are coming in the next month.

"At least when we weren't getting new deals, we had volatility," he said. "Now there's no volatility and no new issues."

Of the day's goings-on, M&T Bank Corp. announced that it plans to sell $500 million of perpetual preferred stock to supplement its tier 1 capital. Additionally, the company said it intends to repay $700 million of Troubled Asset Relief Program funds by the end of the second quarter.


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