BB&T prices massively upsized deal; Citigroup, CYS new issues free to trade; Teekay firms

By Stephanie N. Rotondo

Phoenix, April 24 - The preferred stock market was "trading in a very narrow range" during Wednesday's session, a market source reported.

"Volume was incredibly light," he added. Maybe there was a limited amount of things to be done and maybe people were more focused on the primary market."

As for the primary market, the new issues kept coming Wednesday, as BB&T Corp. said it was selling at least $200 million of series G noncumulative perpetual preferreds, talked around 5.25%. The deal was eventually massively upsized to $450 million and priced at 5.2%.

From Tuesday business, Citigroup Inc.'s benchmark $1.25 billion of 5.35% $1,000-par series D fixed-to-floating rate noncumulative preferreds freed from the syndicate after pricing on Tuesday, a market source said. CYS Investments Inc.'s $200 million of 7.5% series B cumulative redeemable preferreds also freed up after pricing in the previous session.

In new listings, First Republic Bank's $175 million of 5.5% series D noncumulative perpetual preferreds - a deal that priced April 16 - were admitted to the New York Stock Exchange on Wednesday.

In secondary dealings, Reinsurance Group of America Inc.'s 6.2% fixed-to-floating rate subordinated debentures due 2042 made the day's most active list as the company readies to release earnings later this week.

BB&T deal upsized

Winston-Salem, N.C.-based BB&T announced and then priced a $450 million issue of 5.2% series G noncumulative perpetual preferreds on Wednesday.

Initial talk was around 5.25%, and the company was expected to sell only $200 million of the preferred shares.

A trader quoted the issue at $24.75 bid, $24.77 in the midday gray market, noting that paper was trading up to the offered side.

After pricing, a trader said trading in the paper was "a little sloppy," though he expected it would do well.

He pegged the preferreds around $24.80. Another market source quoted the issue at $24.80 bid, $24.85 offered.

"That's a big chunk of change for somebody their size," the source said of the amount of preferreds that were sold. "They certainly slammed the market."

Citi, CYS free up

Citigroup's newly priced $1.25 billion issue of 5.35% $1,000-par series D fixed-to-floating rate noncumulative perpetual preferreds freed to trade on Wednesday.

The benchmark deal priced Tuesday.

At midday, the shares were holding around par, according to a trader.

After the close, a trader said the paper had traded "around par all day long."

Meanwhile, CYS Investments' new $200 million of 7.5% series B cumulative redeemable preferreds also freed up Wednesday.

After the bell, a trader said the securities had "improved," trading up to $24.75.

Teekay on the move

Teekay Offshore Partners LP's $150 million of 7.25% series A cumulative redeemable preferreds were "moving on up," a trader said. He saw a trade at $25.20 around midday but added that there was a $25.10 bid earlier in the day. He speculated the market was closer to the $25.10 mark.

Teekay priced the deal early Tuesday, and it freed to trade shortly thereafter.

First Republic lists, gains

First Republic Bank's $175 million of 5.5% series D noncumulative perpetual preferreds hit the NYSE on Wednesday.

The ticker symbol is "FRCPD." Paper was trading at $24.85 at midday, up 2 cents from the previous close.

The preferred shares closed at $24.90, up 7 cents on the day.

Reinsurance Group rises

Reinsurance Group of America's 6.2% fixed-to-floating rate subordinated debentures due 2042 (NYSE: RZA) moved up 4 cents during midweek trading to close at $27.33.

There was no fresh news out on the St. Louis-based life reinsurance company, though earnings are scheduled to be released on Friday.

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