Banking Giant Truist Financial to Sell Preferred Issue

Banking giant Truist Financial (TFC) has announced a new issue of $25 preferred stock.

The issue will be non-cumulative, but qualified. I expect it will be investment grade rated by both Moodys and Standard and Poors.

Truist is the surviving company from the merger of BB&T and Suntrust late last year and has assets of over $500 billion.

Truist has 5 outstanding preferred issues and the company disclosed they ‘may’ call some preferred stock. The only issues redeemable at this time have coupons of either 4% or 5.20% (2 issues at this level).

‘yield talk’ on the issue is 5% per EarlyBird who was on top of this one.

The preliminary prospectus can be read here.

20 thoughts on “Banking Giant Truist Financial to Sell Preferred Issue”

  1. Utility bb/pref have gone straight up of late. I sold mine and left $$ on the table a few wks back. but looking for a reason people would not sell SOJA SOJB DUKH…..SOJA has a negative ytc and surely will be. SOJB will pay you 1% if called but ok…maybe they don’t. DUKH … i never hold that much premium past call date. (3%). but i could be in the minority. always smart opinions on here…am i missing something or just being too cautious?

    1. ……………something is going on

      i suspect if something is past call / over par the owners of the shares have bought during the last sell off and will have small loss of capital if called…….until then collect the money

      i lowered by cost / share last march by adding IPLDP / DUK.A / SR.A
      but i missed ALP.Q , JPM.C and WFC.L

    2. i was going to keep SOJA while it was pinned to par… but someone bought all my shares $25.70 the other day. Will have to pay some cap gains on that one, as i picked it up in March. Too much call risk now for me.

      1. This past week has just been crazy! Best week since that March bounce back week. Party on!

          1. I sold a couple hundred shares of DMRRP for $15 a share profit holding a couple weeks. Sold several hundred BGEPF for $7 a share holding a few weeks. Those were big ones but also just a constant barrage of short movement trades past week. EAB I captured over the entire quarterly interest payment holding two days. Owned small amount of AUBAP from IPO bought 300 more other day at 25.15 then selling when it spiked up over 25.70 yesterday and then doubled back down harder at 25.17 this morning, and still in line for fast approaching partial first divie. Several more trades like that.
            Then issues I have just keep climbing, HTLFP is up 60 cents just this week, ATH-C has climbed over 26 now, just a lot of this stuff. And then you got issues I own like PPX and LXP-C that go exD and then trade even higher like they never went ex. This stuff is crazy, its been a great month.
            I have had to move money into banks a bit more than I want, but still around 15% of my stash in banks/financials so its not condition red yet. I have had to peel out of some illiquids as some have just gone too high. Enough is enough.
            Just staying out of the crap like many various reit sectors such any type of mall and hospitality, stressed outfits, and energy has really been rewarded. Just seems like everybody is willing to chase safer yield to nail the skin to wall anything and pay up for the pelt.

          2. Yes, it’s been great for sellers. Last month several people here said NI-B was a sell and a “time bomb” at 26.50. I held it and said I would sell above 27.20. Sold yesterday for 27.40. Bought WRB-D at 25.20 a couple of weeks ago, thinking I would hold for a while. Got above 26.20 yesterday so I sold.
            Now need some buy ideas. But I’m patient and holding cash.

            1. Yes some of the spikes have surprised me. I am buying things but dont like to mention as most are long term holders, and most of my buys currently are in and outers…Like EAB which I captured more than quarter interest payment in 2 days this week.

    3. Old adage, sell when you can not when you have to. Patience is a virtue, and we may have to wait awhile for an opportunity to reinvest, but patience is the individual investors greatest advantage.

  2. Their five other preferreds have always traded well…Currently… . Two trade neg ytc, the 5 1/4 callable in 2025 are some 3.85 ytc at 26.76…. Of course I’m a yield ho but….. .They do have room to move.

      1. The common stock pays 4.69% currently! Rather wait and buy that if it goes lower…

        Being a financial holding company, it is subject to less regulation than the mega-banks? Specifically, when Fed told banks to stop buy-backs and may tell them not to pay or reduce dividends, will the same apply to TFC? If not, it could be a good dividend play with some appreciation potential?

        1. The common dividend would be the first to go.
          I have a feeling Ms. Market is thinking that as well.

          1. Thank you JDubs.

            This exactly answers my question of if Fed can pressure them to hold back on dividends.

            The Fed did announce a restrictions already on how much, and if they think banks need to preserve more cash they may just take the next step and say no one give dividends like they did in 2008 crisis – that includes good banks that can afford to and others who are in poor shape due to more bad loans…

            Does anyone recall if the 2007-2008 period had the Fed saying no preferred dividends or was it banks themselves not giving dividends on their preferreds?

        2. The presence or absence of a holding company doesn’t correlate to the level of regulation, which mainly keys off of total assets of the institution and regulators’ evaluation of its CAMEL factors.

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