Preferreds beaten down as equities drop; Goldman, JPMorgan deals above par; Teekay firms

By Stephanie N. Rotondo

Phoenix, April 17 – Preferred stocks were trading sharply lower Friday in sympathy with the broader markets.

The broader markets were coming in on continued concerns surrounding Greece, as well as new trading regulations in China. Both of those issues combined to lead global stocks downward.

The Wells Fargo Hybrid and Preferred Securities index declined 43 basis points, or nearly 11 cents on average for $25-par paper.

Among the week’s new deals, the Goldman Sachs Group Inc.’s 5.375% $1,000-par series M fixed-to-floating rate noncumulative preferreds ended at 100.5, according to a market source.

The preferreds were quoted at 100.375 bid, 100.5 offered early in the session.

Goldman Sachs & Co. ran the books.

Meanwhile, JPMorgan Chase & Co.’s 5.3% $1,000-par series Z fixed-to-floating rate noncumulative preferreds were seen closing around 100.625.

The preferreds were offered at 100.75 earlier in the day.

That issue came Tuesday, with $2 billion of the preferreds being sold. The dividend is fixed until May 1, 2020, when it will begin floating at Libor plus 380 bps.

J.P. Morgan Securities LLC ran that deal.

Meanwhile, Teekay Offshore Partners LP’s $125 million of 8.5% series B cumulative redeemable preferred units were pegged at $24.85, up 8 cents from the previous close and up 20 cents from opening levels of $24.65.

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