Morning Commentary: Charles Schwab plans $1,000-par new issue; People’s United to bring $25-pars

By Stephanie N. Rotondo

Seattle, Oct. 24 – The preferred stock primary market was starting to show signs of life on Monday as two new deals were added to the calendar.

In the $1,000-par space, Charles Schwab Corp. said it was selling $400 million of series E fixed-to-floating rate noncumulative preferreds.

Price talk is 4.875%, according to a market source.

Citigroup Global Markets Inc., Credit Suisse Securities (USA) LLC, Goldman Sachs & Co., J.P. Morgan Securities LLC and Wells Fargo Securities LLC are running the books.

In the $25-par market, People’s United Financial Inc. announced an offering of series A fixed-to-floating rate noncumulative preferreds.

A market source put price talk in the 5.875% area.

JPMorgan, Wells Fargo, Goldman Sachs and Keefe Bruyette & Woods are leading that deal.

But while the new issue market was trying to jumpstart, a trader said the session was “very quiet so far” at mid-morning. Not even the presence of new deals seemed to entice investors.

The trader said he saw a $24.95 bid for the People’s $25-par paper but no offers. Additionally, he had not seen any markets at all for Schwab.

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