National Bank of Greece moves up as bailout OK'd; RBS active, but weaker; U.S. Cellular mixed

By Stephanie N. Rotondo

Portland, Ore., June 3 - The preferred stock market was "kind of mixed today after starting off negative," according to a market source.

National Bank of Greece SA got a boost, as its homeland was approved to draw its next bailout payment. A source said the funding was also viewed as favorable for the financial institution.

Royal Bank of Scotland plc, however, was seen slipping in active trading. The United Kingdom-based bank is reportedly looking at divesting one of its units, though it wasn't clear if that was what prompted the movement in the preferreds.

Meanwhile, United States Cellular Corp. ended mixed on the day. The company will call an issue of its $25-par senior notes later this month and that issue closed weaker.

New issues continued to be active, as investors swapped one for the other. Still, Qwest Corp. - an issue that priced Wednesday - finished up essentially unchanged from previous levels.

National Bank gains big

National Bank of Greece was one of the day's "big gainers," according to a market source.

He said the 9% series A preferreds (NYSE: NBGPA) improved $1.27 to close at $13.45.

The paper had fallen in the previous session to $12.18 on concerns about Greece's upcoming government shortfall and a resulting downgrade by Moody's Investors Service. However, the European Union and International Monetary Fund said Friday it would in fact give the country the next installment of its $161 billion bailout form last year.

It is believed that the consortium will continue to help the country restructure, but will only give it more money with strings attached.

"The view is that it will be equally favorable for the bank," the source said of the gains in National Bank's preferreds.

RBS dips in active trading

In other bank names, Royal Bank of Scotland's series L preferreds were called one of the day's most actively traded securities, with over 805,000 shares changing hands.

The preferreds (NYSE: RBSPL) fell 3 cents to $19.24.

On Thursday, news reports indicated that the United Kingdom-based bank was once again looking to sell off its RBS Aviation Capital unit. The business has a fleet of 249 aircraft in service and 11 in storage and is valued by analysts at $6.8 billion.

RBS had previously attempted to divest the unit in 2009 and then again in April 2010.

Among other financials, Citigroup Inc.'s series M preferreds slipped a penny.

U.S. Cellular ends mixed

U.S. Cellular's 7.5% senior notes due 2034 (NYSE: UZV) traded down 3 cents to $25.46, a market source said.

The issue will be redeemed later this month at par plus unpaid and accrued interest.

The Chicago-based telecommunications company's recently issued 6.95% notes due 2060 (NYSE: UZA) meantime traded up 2 cents to $24.92.

New issues hold steady

A trader said Qwest's recent issue of 7.375% $25-par 40-year bonds was "pretty much unchanged" at $24.70 bid, $24.80 offered.

"I still think this is a good buy," said another trader, quoting the paper at $24.75 bid, $24.80 offered.

The second trader also noted that CommonWeatlh REIT's 7.25% series E cumulative redeemable perpetual preferreds "got hit early, then everything reverted back to normal."

"It's all like a game of musical chairs with less and less chairs," the trader said.

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