Preferreds rebound; Bank of America moves up; Strategic Hotels gets boost on dividend news

By Andrea Heisinger

New York, Dec. 20 - Preferred stocks saw no activity in new deals and little movement in trading on Tuesday, sources said.

There was a small bounce from Monday, when the market was down overall and bank preferreds took the brunt of the hit.

Preferreds were up 10 to 20 cents overall, a source said early in the afternoon.

"People still hate banks," he said.

Bank of America Corp. preferreds were down about 40 cents generically on Monday but were up 15 cents on Tuesday, the source said.

"They sold off," he said. "People are not realizing that they did a tender for preferreds and swapped them out for common stock. The balance sheet looks better."

There was news that Strategic Hotels & Resorts, Inc. completed a tender offer for its 8.25% series C cumulative redeemable preferreds, 8.25% series B preferreds and 8.5% series A preferreds.

A trader said that because "they announced they're paying off dividends," the company's outstanding preferreds were "all up big."

The payment of accrued dividends will be through Sept. 30 and for the quarter ending on Dec. 31, according to a press release. The dividends won't be payable until June 29, 2012.

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