PartnerRe slips, 'doing OK'; Ally preferreds fall as IPO put off; trader: BB&T, RBS good buys

By Stephanie N. Rotondo

Portland, Ore., June 10 - The preferred stock market was "taking its cues from the equity markets," a trader reported Friday.

"Everybody came in looking to sell," he said. Though there was no real "panic" selling, most issues were softer, he added.

Even new issues, like PartnerRe Ltd.'s new 7.25% series E cumulative redeemable preferreds, experienced a bit of weakness. Still, a trader said the deal was "doing well" overall.

Also in the insurance space, Allianz SE's preferreds continued to be touted as a good buy.

Elsewhere, Ally Financial Inc.'s preferreds continued their losing streak into Friday's session. However, this time there was a catalyst that helped push the debt lower: a nixed initial public offering.

The general market weakness pushed down financials such as BB&T Corp. and Royal Bank of Scotland Group plc. At current levels, however, a trader said he saw good opportunities.

PartnerRe 'doing OK'

PartnerRe's new $325 million issue of 7.25% series E cumulative redeemable preferreds "has been doing OK," a trader said.

He said the market was $24.82 bid, $24.92 offered "all day."

Traders had seen the paper in a $24.90-to-$24.95 range on Thursday after the issue was freed from the syndicate.

The Pembroke, Bermuda-based reinsurance company priced the upsized deal on Wednesday.

Also in the insurance realm, Allianz's over-the-counter-traded non-listed preferreds "look cheap down here," a trader said.

He placed the securities at $24.99. The preferreds had been trading around $25.90 earlier in the week.

And, Endurance Specialty Holdings Ltd.'s recent 7.5% series B preferreds (NYSE: ENHPB) traded down 15 cents to $24.55, while the series A preferreds (NYSE: ENHPA) fell a nickel to $25.63.

Ally falls, IPO nixed

Ally Financial's preferreds continued to weaken during Friday trading, but this time, there was a reason: The Detroit-based bank is reportedly delaying its planned IPO due to market conditions.

The 8.5% series A preferreds (NYSE: ALLYPA) fell 36 cents to $25.35 on volume of 1.6 million shares. The 8.125% series B preferreds (NYSE: ALLYPB) meantime declined by 23 cents to $25.35 on volume of nearly 895,000 shares.

The $5 billion to $7 billion IPO had originally been slated for later this month. The IPO would include stock held by the Treasury Department, which owns a 74% stake in the company.

All told, Ally took in $17.2 billion in government aid and has repaid nearly $5 billion via the sale of trust preferreds and dividend payments.

Trader likes BB&T, RBS

Among other financials, a trader said BB&T's series A preferreds looked "attractive" at current levels.

The preferreds (NYSE: BBTPA) fell 18 cents to $25.70.

The trader also saw "good prints" in Royal Bank of Scotland paper. Those issues were down across the board.

The T series preferreds (NYSE: RBSPT) were among the biggest losers, dropping 20 cents to $19.50. The series M preferreds (NYSE: RBSPM), by comparison, were only a penny weaker at $17.84.

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