As noted by some of our readers Bank of America (NYSE:BAC) has sold a new con-cumulative preferred issue with a fixed rate coupon of 5.875%.
As is usual with Bank of America (or any of the massive banks) the issue is large with 34,000,000 shares being offered.
The terms are the normal banking terms–non-cumulative, qualified dividends and quality payments. The issue begins the optional redemption period in July, 2023.
The issue is trading on the OTC Grey Market under the temporary ticker of BKAML and was recently priced at $25.10
The company has stated they may call other preferred issues with the proceeds and this issue is large enough to call either the BML-I issue which carries a 6.375% coupon or the BAC-D issue which has a 6.20% coupon. Both are now redeemable and trading at slight premiums to call prices ($25 plus accrued dividends).
The company has many preferred issues, but some are floating rate issues which likely won’t be called for years or years as they have either 3% or 4% minimums. An entire listing on all bank and insurance company issues can be found here.
We personally have no interest in this issue, but certainly it may be of interest to those looking for a very conservative issue and are comfortable with the non cumulative feature.