Published on 1/22/2020 in the Prospect News Investment Grade Daily and Prospect News Preferred Stock Daily.
New Issue: Bank of America sells $1.1 billion 4.3% fixed-to-floating preferreds
By James McCandless
San Antonio, Jan. 22 – Bank of America Corp. priced a $1.1 billion offering of $1,000-par series MM fixed-to-floating rate non-cumulative preferred stock (Baa3/BBB-/BBB-) with an initial dividend of 4.3% on Tuesday, according to an FWP filing with the Securities and Exchange Commission.
There is no greenshoe.
The deal was announced Tuesday morning.
BofA Securities, Inc. is the bookrunner.
Dividends are payable on Jan. 28 and July 28 until Jan. 28, 2025, then become payable on Jan. 28, April 28, July 28 and Oct. 28.
The dividend is fixed until Jan. 28, 2025, then converts to a floating rate of Libor plus 266.4 basis points.
The preferreds are redeemable on or after Jan. 28, 2025 at par. Prior to that, the preferreds are redeemable within 90 days after a capital treatment event.
Bank of America plans to use the proceeds for general corporate purposes, including, but not limited to, the repurchase or redemption of outstanding preferred securities.
The company does not intend to list the preferreds on any securities exchange.
Bank of America is a Charlotte, N.C.-based financial services company.
| Issuer: | Bank of America Corp.
|
| Description: | Series MM fixed-to-floating rate non-cumulative preferred stock
|
| Amount: | $1.1 billion, or 1.1 million shares
|
| Maturity: | Perpetual
|
| Bookrunner: | BofA Securities, Inc.
|
| Senior co-managers: | ABN Amro Securities (USA) LLC, Banca IMI SpA, BBVA Securities Inc., BMO Capital Markets Corp., BNY Mellon Capital Markets, LLC, Capital One Securities, Inc., CIBC World Markets Corp., Commonwealth Bank of Australia, Danske Markets Inc., Huntington Investment Co., ING Financial Markets LLC, KeyBanc Capital Markets Inc., Lloyds Securities Inc., Mizuho Securities USA LLC, MUFG, nabSecurities, LLC, NatWest Markets Securities Inc., Nomura Securities International, Inc., Nordea Bank ABP, Santander Investment Securities Inc., Scotia Capital (USA) Inc., SMBC Nikko Securities America, Inc., Standard Chartered Bank, SunTrust Robinson Humphrey, Inc. and UniCredit Capital Markets LLC
|
| Junior co-managers: | Academy Securities, Inc., American Veterans Group, PBC, Apto Partners, LLC and R. Seelaus & Co., LLC
|
| Dividend: | 4.3% until Jan. 28, 2025, then converts to a floating rate of Libor plus 266.4 bps
|
| Price: | Par of $1,000
|
| Yield: | 4.3%
|
| Call: | On or after Jan. 28, 2025 at par; prior to that, within 90 days after a capital treatment event
|
| Pricing date: | Jan. 21
|
| Settlement date: | Jan. 24
|
| Ratings: | Moody’s: Baa3
|
| S&P: BBB-
|
| Fitch: BBB-
|
| Distribution: | SEC registered
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