Preferred primary active; Progressive prices; QTS frees to trade; 1347 Property breaks par

By Abigail W. Adams

Portland, Me., March 9 – The primary market in the preferred space was active with two new deals pricing after the market close Thursday and a new deal launching prior to the market open Friday.

Bank of America Corp. priced $2.35 billion of perpetual fixed-to-floating rate non-cumulative preferred stock, series FF, after the market close on Thursday with a dividend of 5.875%, according to an FWP filing with the Securities and Exchange Commission.

The preferred stock will be sold as $1,000-par depositary shares representing a 1/25th interest.

QTS Realty Trust, Inc. priced $100 million of 7.125% series A cumulative redeemable perpetual preferred stock after the market close on Thursday.

The preferred stock freed to trade for OTC market business under the ticker “QTTRP” and were seen trading below its issue price on Friday.

Progressive Corp. priced a $500 million offering of 5.375% $1,000-par perpetual series B fixed-to-floating rate cumulative preferred shares (Baa1 / BBB+ / BBB+) after the market close on Friday, according to a FWP filing with the Securities and Exchange Commission.

Progressive’s preferred shares will not be listed on any securities exchange.

As the primary market saw an uptick in activity, preferreds were down in trading in the secondary space according to market indicators.

The Wells Fargo Hybrid & Preferred Securities Financial index was down 0.29% at the market close Friday. The U.S. iShares Preferred Stock ETF was up 0.07% early in Friday’s session but closed the day down 0.08%.

While the broader market was down, 1347 Property Insurance Holdings, Inc.’s recently priced 8% series A perpetual cumulative preferred stock broke above par on Friday after trading down since freeing for trade on the OTC market.

QTS frees for trade

QTS Realty’s 7.125% series A preferred stock freed to trade on Friday after pricing after the market close Thursday.

The preferreds opened for trade on Friday at $24.57 and closed the day at $24.75. Prior to pricing, the preferred stock offering was trading down in the gray market, a market source said, an indication it would not do well.

QTS priced $100 million of 7.125% series A cumulative redeemable perpetual preferred stock Thursday. The preferred stock will be listed on Nasdaq under the ticker “PIHPP.”

1347 breaks par

1347 Property Insurance’s recently priced 8% series A perpetual cumulative preferred traded up to their issue price for the first time since freeing for trade.

1347 priced $16 million in $25-par 8% series A perpetual cumulative preferred shares on Feb. 23. The deal was downsized from the initially launched $20 million.

It was not well received by investors during the bookbuilding process, a market source previously said.

The preferred stock from the Tampa, Fla.-based insurance holding company have traded below their issue price since they freed to trade for OTC market business under the temporary ticker “PPNSP.”

However, the preferreds closed Friday at $25, an increase of 40 cents, or 1.63%.

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