Regions Financial (RF) has announced a redemption of their RF-B 6.375% fixed to floating preferred which was set to go to floating on 9/16–the effective date of the redemption. The issue was set to jump up to a coupon of 8.85% (more or less) once the float kicked in.
This issue was only redeemable on a dividend payment date which is 9/16 (the 15th is a Sunday)
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Tim,
What web site/sites do you use for tracking preferred info? I have news wires on my desk and complete bond info close to BV……. but sites like quantum are way behind realtime. Much less track current prices w detailed examination of individual issue
Parked some short term money here today. 7% APY with qualified dividend and a small capital loss sure beats the alternatives.. Unless something goes wrong.
When they issued the RF-F there wasn’t much said about calling the B.
This is a pleasant surprise, with one less preferred sitting out there it makes the support for the remaining ones stronger. Chuck P and myself had a small discussion and felt the F wasn’t good for a long term hold, but I’m allowed to change my mind and decided to make a small purchase for a quick flip in a couple months if a rate cut happened. Instead I found myself going more into the red on my first purchase as the price fell. But since it seems like a solid bank I bought several more tranches. In for a dime now for a dollar.
You’re right not much was said and that was because what was said was so succinct… No surprise here –
USE OF PROCEEDS
We expect to receive net proceeds from this offering, after deducting underwriting discounts and estimated
offering expenses payable by us, of approximately $488,441,000. 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
purpose
2whiteroses, I suspected I have been having more Betty White moments and you just confirmed it.
Have you joined in the fun yourself and snagged a small amount?
Naturally…. It’s the kind of thing I’m always doing. Many think it’s a silly thing to bother doing because it’s so penny ante, but as long as you feel more comfortable always holding a healthy amount of cash in money market funds, why not beat the going rate by buying called bonds or bonds you expect to be called when they provide a coupla hundred basis points of added yield for your idle cash? III’ers have talked about the similar opportunity with a seller in CKNQP out there this week… I didn’t get any of that because I’m already full up on it, but that’s the kind of thing – a little different from an announced call like RF-B but I bot RF-B in advance of the actual announcement too… In the case of a CKNQP it feels like one of those situations where you’d be happy to be wrong if they don’t call…
Exactly the same here, although I missed out on the CKNQP I started looking at Tim’s list of Preferred floating rate and saw all the red from redeemed issues and it seems like a good place to look for the next opportunity.
Speaking of call possibilities, I noticed this news in the Ramaco quarterly report out yesteday that might negatively impact METCL – “In July, the Company repaid the remaining $7 million in acquisition debt related to the $30 million purchase of Maben Coal LLC in 2022. The Company has now retired all $75 million of acquisition debt related to its 2022 Maben and Ramaco Coal acquisitions. Today, the $35 million 9% Unsecured Notes due in 2026 [aka METCL] is the only remaining term debt excluding amounts drawn on the Revolving Line of Credit.”
Pattern wise, I suppose if they were to start on METCL they would’t call it all at once, but it’s also callable on only 10 days notice… As it trades above one full quarterly payment right now at 25.61, perhaps it’s slightly too high???? Any opinion?
Was just looking at Quantum late today wasn’t updated there……I was hoping for some overtime, but yeah. So for RF fans the 8.95 is a pleasant bump anyway!!
6.95
BTW The drop in brokered CD rates is alarming.
If you Prefer – yes the shine has come off quickly, although with some limited buys I can take 4.9%. Treasuries were a bit better.