Brighthouse Financial Announces New Preferred

We start off the week right away with another new preferred issue being announced.

Insurer Brighthouse Financial (BHF) has announced they are selling a new non-cumulative preferred. The issue will be rated BBB- (low investment grade) by Standard and Poors and Ba2 (below investment grade) by Moodys.

The issue will have the typical optional redemption (optional to the company) period starting in 6/25/2025.

The permanent ticker will be BHFAO when it finally hits the NASDAQ exchange.

The company has 1 preferred and 1 baby bond outstanding now and they can be seen here.

The preliminary prospectus for the new issue can be read here.

mcg was right on top of this new issue under the Ready Initiated Alerts.

8 thoughts on “Brighthouse Financial Announces New Preferred”

  1. BHF preferreds may be split rated but they are trading like crud. If you group pfd’s in a 1, 2,3, and 4 like system…with 1 as highest BHFAP and co are trading like they are group 3.

    I have no idea what they own, what risks they are taking BUT Brighthouse Financial used a VA like insurance wrapper around equity investments allowing investors to go long the market and get a living benefit type guarantee behind it. In other words they took they insurance behind many VA contracts and applied it to MF equity investments outside of VA’s. So when markets were tanking their risks were climbing. And visa versa. At this level S&P some can breath a sigh of relief!

    Current rate projected…. 6.75 to 6 7/8s . Beats up older issues . If they price there ughh for current investors

  2. Curious where can I buy this preferred? Is the IPO available or do I have to buy it in secondary market. I looked it up in my Fidelity account but did not see it in their IPO listing

  3. A comment on the vaccine news that caused the euphoric market reaction. Moderna’s news may be good but we need to be careful with this company. They’ve been touting their technology for about 10 years and have failed to produce a single successful product based on mRNA. One particular potential drug based on this technology had to be abandoned in 2017 due to its toxic side effects. This vaccine trial is a very small preliminary study and they report only 3 of what they label as serious systemic reactions out of the 45 volunteers but no one died so that’s good. Personally, I would wait for the results of much larger studies before I’d consider taking one of their vaccines. Other companies will be running trials using mRNA so we should have more info on this but it’ll be several months at least.

  4. If you go to their website and read all of it it looks like a pretty decent and solid company. Its really a division of the old Met Life. They strictly specialize in annuities and life insurance. Their website says they are #457 on the Fortune 500 list. Rated A3 by Moodys, A+ by S&P, A by A M Best and A by Fitch. They have over 2 million customers and over $227 Billion in assets. The only Butt for me is they list $211 Billion in liabilities. But I do understand that is the potential “Payoffs” when they happen. So you spread that over decades and decades. Like I say it does look like a pretty solid company. Iam close to fully invested with only about 10% cash now so probably will have to take a pass. Thank You for listing it Tim.

    1. Life insurance and annuities businesses could be very challenged going forward. CV19 payout liabilities, pricing risk on new policies, together with ZIRP limited asset returns have kept me underweight that sector. I like P&C, especially automobile, but there are limited preferred options and the debt doesn’t reflect the risk (yet) IMO.

      1. How is life insurance and annuities going to work if interest rates go negative. Gives me a headache. My broker warned me off of Prudential because they have a large book of business in Europe and the negative rates are screwing up future prospects??

    2. Every time Brighthouse has come out with a new issue, I’ve checked their financials and have been scared away because of the wild swings in derivative gains/losses (and it’s been mostly losses).

      I understand that many insurers use derivatives to hedge their risks, and it’s all probably beyond my pay-grade anyway. But either Brighthouse is being far too speculative with derivatives (for their size), or they’re very bad at it. Either way, for my risk tolerance, I’m still passing on this one.

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