Bank of America greenshoe exercise ups 6.5% preferreds to $1.1 billion

By Susanna Moon

Chicago, Jan. 27 – Bank of America Corp.’s underwriters fully exercised the $100 million over-allotment option on its 6.5% series Y noncumulative perpetual preferred stock.

This brings the total deal size to $1.1 billion.

As previously announced, the company sold $1 billion of the perpetual preferreds (expected ratings: Ba3/BB/BB) at par of $25 on Jan. 20.

The preferreds were talked in the 6.625% area.

BofA Merrill Lynch was the bookrunner. Joint lead managers included Citigroup Global Markets Inc., Goldman Sachs & Co., J.P. Morgan Securities LLC, Morgan Stanley & Co. LLC, UBS Securities LLC and Wells Fargo Securities LLC.

Dividends will be payable on a quarterly basis. The Charlotte, N.C.-based bank can redeem the preferreds on or after Jan. 27, 2020 or upon a regulatory capital treatment event at par plus accrued dividends.

Proceeds will be used for general corporate purposes.

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