Priority Income Fund to Try Again to Sell Term Preferred Issue

Closed end fund Priority Income Fund, (a non traded fund), will attempt again to sell a new term preferred issue. This issue will have a mandatory redemption in 2024.

As you may recall Priority tried to sell this issue back in November/December and with the turmoil in the marketplace they were unable to round up demand for the issue.

The company has 2 issues already outstanding.

The PRIF-A issue has a coupon of 6.375% and trades today around $24.60 as it has dropped on the announcement of a new issue–it had been trading around $25. This issue has a mandatory redemption in 2025.

The PRIF-B issue has a coupon of 6.25% and trades today around $24.50 after dropping based on the new issue–it had been trading around $24.90. This issue has a mandatory redemption in 2023.

Priority, being a closed end fund, is required to maintain a 200% coverage ratio on their senior securities. The last time we calculated the coverage ratio they were at 900%.

Preliminary info on the new issue can be found here.

2 thoughts on “Priority Income Fund to Try Again to Sell Term Preferred Issue”

  1. Tim, The slide show was a compelling read. Underlying is selective senior-secured loans (65% AAA), extremely well-diversified, financing is locked and not subject to margin call (huge). All appears quite positive, muted a bit by the stepchild-like discussion of the pfds (7.0) though as you indicated the 200% asset coverage requirement is in place. Am I missing something? These look good on the cover.

    1. Tim, I have just received an email alert from Doug Le Du. The symbol is PRNCP. Looks like it started trading from Fido Active Trader PRO since Feb 22. Around 80,000 shares were sold yesterday at $24.80. Today at 2:11 pm EST, a little over 24,000 shares with bid of $24.80 vs. ask of $24.90. Last trade 40 shares at $24.80. 6.625%. Callable in 2 Yr. non cumulative, probably QDI.

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