Saul Centers taps $25-par market; Capital One preferreds decline; Bank of America under water

By James McCandless

San Antonio, Sept. 10 – The preferred space was negative across the board as the Tuesday session ended.

The primary market got a new deal in Saul Centers, Inc.’s new upsized $100 million offering of $25-par 6% series E cumulative redeemable preferred stock.

At the top of volume, Capital One Financial Corp.’s new 5% series I fixed-rate non-cumulative perpetual preferred stock declined.

Elsewhere in finance, Bank of America Corp.’s 6% series GG and 5.875% series HH non-cumulative preferred stock were both under water.

Sector peer JPMorgan Chase & Co.’s 6% series EE non-cumulative preferreds followed the day’s trend.

Meanwhile, REIT Public Storage’s new 4.875% series I cumulative preferred shares also saw a dip.

New Residential Investment Corp.’s 7.125% series B fixed-to-floating rate cumulative redeemable preferreds moved lower.

Saul Centers’ deal

Saul Centers priced an upsized $100 million offering of $25-par series E cumulative redeemable preferred stock with a dividend of 6%.

There is a $10 million greenshoe.

The deal, announced on Tuesday morning, was upsized from an initial $75 million and came in at the high end of talk for a dividend between 5.875% and 6%.

Raymond James & Associates, Inc., Stifel, Nicolaus & Co., Inc., B. Riley FBR, Inc. and D.A. Davidson & Co. are the joint bookrunners.

The preferreds are redeemable after five years at par. Prior to that, they are redeemable within 90 days after a delisting event or within 120 days after a change of control at par.

Capital One declines

At the top of volume in the secondary, Capital One’s new 5% series I fixed-rate non-cumulative perpetual preferred stock was in decline.

The preferreds, trading under the temporary symbol “COFOL,” were down 19 cents to close at $24.75 on volume of about 2.1 million shares.

On Monday, the preferreds lost 15 cents.

Elsewhere in the finance space, Bank of America’s 6% series GG and 5.875% series HH non-cumulative preferred stock were both under water as the session ended.

The series GG preferreds (NYSE: BACPrB) lost 11 cents to close at $26.77 with about 331,000 shares trading.

The series HH preferreds (NYSE: BACPrK) fell 13 cents to close at $27.08 with about 317,000 shares trading.

Sector peer JPMorgan’s 6% series EE non-cumulative preferreds followed the day’s downward trend.

The preferreds (NYSE: JPMPrC) shaved off 3 cents to close at $28.23 on volume of about 302,000 shares.

On Monday, the preferreds gained 3 cents.

Public Storage dips

Meanwhile, real estate investment trust Public Storage’s new 4.875% series I cumulative preferred shares also saw a dip by the end of the day.

The preferreds, trading under the temporary symbol “PBSSP,” dipped by 10 cents to close at $25.10 with about 887,000 shares trading.

On Monday, the preferreds added 5 cents.

New Residential, another REIT, saw its series B fixed-to-floating rate cumulative redeemable preferreds move lower.

The preferreds (NYSE: NRZPrB) were down 8 cents to close at $24.91 on volume of about 380,000 shares.

On Monday, the preferreds dropped 7 cents.

Indexes down

The Wells Fargo Hybrid & Preferred Securities Financial index lost 0.41%, shooting past the 0.04% decline from early Tuesday trading.

The iShares US Preferred Stock ETF was down 18 cents to $37.17.

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