Midday Commentary: Preferred space seeing 'massive outflows'; Zions launches redemption of series Cs

By Stephanie N. Rotondo

Phoenix, Aug. 16 - A preferred stock trader said the market was "continuing to trickle down" on Friday, even as the straight equities attempted to rebound.

"There are a lot of stories on the newswires about the massive outflows from different preferred funds," he said. Part of those outflows was likely due to all of the redemptions that have occurred, but some of it was due to concerns about interest rates and yields in relation to other credit structures, like municipal bonds.

Based on how spreads had widened compared to Treasuries, he said, the market was "oversold."

Late Thursday, Zions Bancorporation officially announced the redemption of its 9.5% series C noncumulative perpetual preferreds.

The paper (NYSE: ZBPC) was trading up a penny at $25.58 at midday.

The company originally said on July 24 it was planning to redeem $590 million of the preferreds. However, the official announcement stated that the redemption was for the entire $799.5 million outstanding.

The call date is Sept. 15. The call price is par plus 60.6944 cents in accrued dividends.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.