4/24/2025
Our site runs on donations to keep it running for free. Please consider donating if you enjoy your experience here!
$61 billion in assets, Valley National Bank (VLY), has priced their new fixed rate reset preferred.
The issue prices at an initial coupon of 8.25% with a reset date in just over 5 years at the 5 year treasury plus a fixed spread of 4.182%. There after the issue is reset every 5 years.
The early redemption option starts on 9/30/2029. Redemption can occur only on a dividend payment date.
I am sure most of you are aware that insurer Enstar Group (ESGR) has announced a merger and will be going private.
My understanding of the deal is that the outstanding preferred shares of ESGR will be exchanged for similar new shares, but will not be listed for trading. The announcement is here.
The company has (2) 7% preferreds that are outstanding and they are tumbling. This is a case where readers should always check the Reader Initiated Alerts page for ‘breaking news’—folks on this site are very much in tune with what is going on–much quicker than I can be.
I held a small position in the 7% ESGRO issue which I exited at $23.83 earlier today. I took a 12 cent capital loss as I paid $23.95 for it, but held for a long time so it was a positive total return. Some quick folks were out at the market open at higher prices.
Shares have been falling all morning and folks will need to decide to hold or go ahead and sell. I suspect over time dividends will be just fine—but one never knows.
New Jersey banker Valley National (VLY) has announced they will be selling a new fixed rate reset $25/share preferred.
While the banker doesn’t mention a ‘call’ in their filing they do have a fixed to floating rate issue (VLYPO) which is now paying a coupon of around 8.9% so one would think it is possible they would call this issue. It is trading at $24.24.
The preliminary prospectus is here.
Thanks to J for mentioning this one.
Regions Financial (RF) has priced their new fixed rate reset preferred with an initial coupon (for about 5 years) of 6.95%. After 9/15/2029 the coupon will reset at the 5 year treasury plus a spread of 2.771% and will reset every 5 year thereafter.
As noted earlier the proceeds will be used to redeem their RF-B 6.375% issue which was slated to being floating on 9/15/2024—likely at a coupon above 8%.
The new issue is split investment grade with Moodys giving the lower investment grade rating of Baa3, while S&P and Fitch are a notch lower.
The pricing term sheet for the new issue can be found here.
Regions Financial (RF) has announced a new issuance of fixed rate reset perpetual preferred stock. The issue will have an optional redemption period starting 9/15/2029.
The banker has a number of preferred issues already outstanding, including 2 fixed to floating issues–one of which becomes redeemable starting 9/15/2024. As we have come to expect the fixed to floating issue RF-B will be redeemed with the proceeds of this new issue.
Use of proceeds statement–
We expect to receive net proceeds from this offering, after deducting underwriting discounts and estimated offering expenses payable by us, of approximately $ (or approximately $ if the underwriters exercise in full their option to purchase additional depositary shares). We intend to use the net proceeds to redeem all outstanding shares of the Series B Preferred Stock and to use any remaining proceeds for general corporate purposes.
The preliminary prospectus can be read here.
Thanks to J for posting this and to EarlyBird for posting ‘yield talk’ in the 7.125% area.