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9/27/2024
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2WR,
I use Fidelity software and site for information about bonds just because the software is much easier for me to finagle. I also learned today that I was misinterpreting the coupon listing for a floating rate note like this PPL bond. The rate that Fidelity is quoting in their overview page of the bond lists the coupon rate of the last payment, but not the “current rate”, which can be quickly calculated using the forward CME SOFR that has been recently cited on this site?
I’ve often thought that there should be a place in this world where a website aggregates F/F rate issues and keeps track of and publishes the new rates for each issue the day after the new rate is calculable… Nobody does that it seems and no issuer seems to think it’s important enough for their IR Dept to put out the number immediately…. Tex, you listening??? Maybe you could use Excel to create such a site and call it floatersRus.com or something?
I am surprised and wondering.
I own this bond (thanks to Dick Whtiman):
69352PAC7 – PPL – floats off the 3 month plus 2.66%
It’s time for the floating rate to reset (September 30 in the prospectus) and I recently received notice from the company through my broker (IBKR) statement:
….PPL Float 03/30/67 announced a coupon payment, effective 20240927. The declared rate on the coupon payment will be USD 0.02157.
ISIN: US69352PAC77….
This actually calculates out to a rate of 8.63%, which surprises me that it is that high. I have access to the prospectus, but I have not found the details about how the change from LIBOR to SOFR is handled.
any comments or assistance would be appreciated.
It is now SOFR+266+26. Coupon does seem high unless the determination date was more than a few weeks ago.
I own it too.
landlord,
It’s odd. almost like it a three month SOFR backwards calculation…
I still cannot find PPL’s statement about LIBOR to SOFR on its website or at the SEC… of course, it’s always possible that the note I got at IBKR is incorrect….
Voner – Here is the LIBOR statement:
https://www.prnewswire.com/news-releases/ppl-capital-funding-to-replace-reference-rate-for-junior-subordinated-notes-301839214.html
Here is the prospectus:
https://www.sec.gov/Archives/edgar/data/922224/000089322007000812/e31666b2e424b2.htm
See p S-14 “Floating Rate Period”
If the rate is 8.63%, then they must be announcing the rate to be paid on 9/30 which was set on or about June 28.
Thanks to all ..2WR ..Mr Whitman.. ..landlord
2Wr explains it. It’s not been a good day for thinking for me. I made the assumption that the notice I got from IBKR Was the declaration for the calculation for the next three months, but it was the declaration for the payment for the past three months…
funny, I was texting someone today and they made light of my lack of ever assuming anything (a not uncommon statement to me) which made me think of the old slogan -“assume” makes an ass out of u and me…
By extension, you now know as of today (or maybe yesterday) you can calculate the rate for the 12/30 coupon, right?
2WR,
yep, and thanks for asking. I also know which SOFR rate to use, thanks to you.