By Stephanie N. Rotondo
Seattle, Feb. 29 – The Charles Schwab Corp. priced $750 million of 5.95% $25-par series D noncumulative perpetual preferred stock (expected ratings: Baa2/BBB) on Monday, a market source reported.
Initial price talk was 6% to 6.125%. The deal was upsized from $250 million.
The preferreds will be issued as depositary shares representing a 1/40th interest.
BofA Merrill Lynch, Morgan Stanley & Co. LLC, UBS Securities LLC and Wells Fargo Securities LLC were the joint bookrunning managers.
When declared, dividends will be paid on the first day of March, June, September and December. The preferreds become redeemable on or after June 1, 2021 or in whole within 90 days of a regulatory capital treatment event at par plus accrued dividends.
Proceeds will be used to support balance sheet growth, including the migration of certain client balances from sweep money market funds into Schwab Bank.
Charles Schwab is a San Francisco-based savings and loan holding company.
| Issuer: | The Charles Schwab Corp.
|
| Securities: | Series D noncumulative preferred stock
|
| Amount: | $750 million, or 30 million shares
|
| Maturity: | Perpetual
|
| Bookrunners: | BofA Merrill Lynch, Morgan Stanley & Co. LLC, UBS Securities LLC, Wells Fargo Securities LLC
|
| Dividend: | 5.95%
|
| Price: | Par of $25.00
|
| Yield: | 5.95%
|
| Talk: | 6% to 6.125%
|
| Call options: | On or after June 1, 2021 or within 90 days of a regulatory capital treatment event at par plus accrued dividends
|
| Pricing date: | Feb. 29
|
| Settlement date: | March 7
|
| Expected ratings: | Moody’s: Baa2
|
| Standard & Poor’s: BBB
|
| Expected listing: | NYSE: SCHWPD
|
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