Wells Fargo sells upsized $1 billion of preferred stock; Validus gets temporary ticker

By Stephanie N. Rotondo

Seattle, June 8 – The preferred stock new issue calendar continued to build on Wednesday, as Wells Fargo & Co. announced a sale of at least $250 million series X class A noncumulative perpetual preferred shares. The issue eventually came well upsized at $1 billion, priced at par to yield 5.5%.

“It’s a good time to raise capital,” a trader said. “Especially if they make things more stringent for banks, it’s good to have more cash on hand.”

Post-pricing, a trader pegged the new issue at $24.92 bid, $24.94 offered.

In response to the new issue, the bank’s 5.7% series W class A noncumulative perpetual preferreds (NYSE: WFCPW) were trading off 16 cents to $25.64. The 8% series J class A noncumulative perpetual preferreds (NYSE: WFCPJ) dropped 27 cents, or nearly 1%, to $27.51.

Price talk on the new issue was in the 5.625% area, a market source said.

Wells Fargo Securities LLC was the bookrunner.

Meanwhile, Validus Holdings Ltd.’s $150 million of 5.875% series A noncumulative preference shares – a deal priced Monday – were then seen at $24.88 bid, $24.90 offered early in the day. Paper closed at $24.89, which was up 4 cents from the previous session but down from opening levels of $24.97.

The issue is trading under a temporary symbol, “VRHSP.”

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