6/19/2025
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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.
It is amazing that some investors (not sure who) buy real junk based purely on a current yield of a preferred stock–do these folks ever even look at the income statement and balance sheet of the company they are investing in?
Today I noted a new prospectus come though for LuxUrban Hotels (LUXH) which has a $25/share preferred stock outstanding (LUXHP)–which is now trading at $14.12/share. Really?
The new prospectus today is for the sale of more common shares–which they have been shoveling out the door as quickly as possible–I assume to try to keep from having to liquidate. Common shares are trading at 15.99 CENTS (it closed at 18.5 cents) falling a couple cents after market close.
LuxUrban has committed to long term leases on hotels (on a triple net basis) and then turns around and operates them–I guess they believe they can do better than the previous operator. The company has amended their certificate of incorporation to allow for issuing up to 200 million common shares and 20 million preferred shares. This is essentially a doubling of authorized shares. When you are selling at 15 cents it takes millions of shares to generate a little cash.
The company has announced they will be paying the monthly preferred dividend on July 31–but one has to wonder how long this will go on–they have only $900,000 cash on hand.
This company is headed for Chapter 11–it is just a question of when they through in the towel. And while the writing is on the wall someone is willing to pay $14/share for the preferreds–who?
Fortress Biotech (FBIO) has suspended the cumulative dividend on their 9.375% preferred issue. This issue was originally sold in 11/2017. Friday shares closed at $16.31 with a current yield of 14.4% (before suspension). Common shares closed at $1.80/share.
The press release is here and was released after market hours Friday. We should expect to see a substantial drop in the share price on Monday.