Category: Issue Comments

Brookfield Asset Management has announced:

an offering of C$300 million of medium term notes (unsecured) (“notes”) with a September 2016 maturity and a yield of 5.2%.

The notes have been assigned a credit rating of Baa2 (stable outlook) by Moody’s; A- (negative outlook) by Standard & Poor’s; BBB (stable outlook) by Fitch; and A low (stable outlook) by DBRS.

The notes are being offered through a syndicate of agents led by CIBC World Markets Inc. and RBC Capital Markets.

The net proceeds of the issue will be used to refinance US$200 million of notes that matured March 1, 2010 and for general corporate purposes.

This is useful data to have when evaluating BAM.PR.J, which is retractible on 2018-3-31 (presumed to trigger a call at $25 immediatly prior to exercise) which closed last night at 26.03-05 to yield 4.94-3%, equivalent to 6.90-1% interest at the standard equivalency factor of 1.4x. The interest-equivalent spread of about 170bp will be thought by many to more than adequately compensate for the seniority risk and slightly longer term. Note, however, that I have not yet reviewed the prospectus for the new bond issue – there may be terms and conditions peculiar to these notes which affect valuation.

Update: The Globe and Mail reports there is a credit-rating-linked put:

To give investors comfort, single-A-rated Brookfield agreed to buy back this paper at 101 cents on the dollar if its credit rating drops below investment grade, or if there is a change in control at the conglomerate.

That’s valuable – but in aggregate, that type of clause can leave credit quality on a knife-edge … as AIG found out.

These are total returns, with dividends presumed to have been reinvested at the bid price on the ex-date. The list has been restricted to issues in the HIMIPref™ indices.

Industrial Alliance Insurance and Financial Services Inc. has announced:

the closing of its previously announced offerings of 2,950,000 Common Shares (the “Common Shares”) at a price of $34.00 per Common Share representing aggregate gross proceeds of $100 million, and 4,000,000 5.90% Non-Cumulative Class A Preferred Shares Series F (the “Series F Preferred Shares”) at a price of $25.00 per Series F Preferred Share, representing aggregate gross proceeds of $100 million.

The offerings were underwritten, on a bought deal basis, by a syndicate of underwriters co-led by BMO Nesbitt Burns Inc. and RBC Dominion Securities Inc. and which includes National Bank Financial Inc., Scotia Capital Inc., CIBC World Markets Inc., TD Securities Inc., Desjardins Securities Inc., Casgrain & Company Limited, Dundee Securities Corporation, HSBC Securities (Canada) Inc., Industrial Alliance Securities Inc. and Laurentian Bank Securities Inc.

These offerings were made under the terms of prospectus supplements dated February 19, 2010 to the short form base shelf prospectus dated April 30, 2009. The prospectus supplements are available on the SEDAR website at www.sedar.com and on the Company’s website at www.inalco.com.

The issue was announced on February 17.

Today it traded 72,800 shares in a range of 24.41-88 before closing at 24.55-60, 15×126.

Vital statistics are:

IAG.PR.F has been added to the PerpetualDiscount index.

BPO Properties has announced:

a proposal to create Canada’s pre-eminent office real estate investment trust (REIT). Upon conversion, the new REIT, to be named Brookfield Office Properties Canada, will acquire BPP’s directly owned office assets in Toronto, Calgary and Vancouver and will also acquire Brookfield Properties’ interest in Brookfield Place, widely regarded as the top commercial complex in Canada. If approved by BPP shareholders, upon closing of the transaction, it is expected that Brookfield Office Properties Canada will pay a special distribution of $1.02 per unit to unitholders and will also begin to pay monthly distributions of $0.0667 per unit (being $0.80 per unit on an annualized basis), double BPP’s current quarterly dividend of $0.10 per common share.
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If approved by the Toronto Stock Exchange (TSX), the new REIT, Brookfield Office Properties Canada, will commence listing on the TSX immediately following closing of the transaction. Holders of BPP common shares will receive one unit of Brookfield Office Properties Canada for each common share held of BPP. Upon closing of the transaction, BPP’s common shares will be delisted from the TSX and all of its common equity will be owned by Brookfield Properties. Select assets of BPP, including the Canadian Office Fund and certain development properties, as well as certain assets which are not permitted to be owned by Brookfield Office Properties Canada, will be retained by Brookfield Properties. No changes will be made to the terms of BPP’s preferred shares.
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The transaction will be effected by way of a plan of arrangement under the Canada Business Corporations Act. It requires the approval of at least two-thirds of the votes cast by all shareholders as well as the approval of a simple majority of the votes cast by common shareholders other than Brookfield Properties and its affiliates. The transaction must also be approved by the Ontario Superior Court of Justice. The transaction is also conditional upon receipt of all necessary regulatory, TSX and third party consents and approvals.
Brookfield Properties has advised BPP that Brookfield Properties and its affiliates intend to vote all of their shares of BPP in favour of the transaction.

If approved, on closing of the transaction, Brookfield Properties and its affiliates, which currently hold approximately 89.7% of BPP’s common equity, will hold in aggregate an equity interest in Brookfield Office Properties Canada of approximately 91%, including the consideration Brookfield Properties is receiving for the sale of Brookfield Place, net of the impact of retaining certain assets and preferred shares which are not being transferred to Brookfield Office Properties Canada.
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Analysts, investors and other interested parties are invited to participate in a live conference call and webcast on March 1, 2010 at 4:30 p.m. (E.T.) to discuss the proposed transaction with members of senior management. To participate in the conference call, please dial 866.238.1640, pass code 1434853 five minutes prior to the scheduled start of the call. Live audio of the call will also be available via webcast at www.bpoproperties.com. A replay of this call can be accessed through April 14, 2010 by dialing 888.266.2081, pass code 1434853. A replay of the webcast will be available at www.bpoproperties.com for one year.

An information circular describing the transaction is anticipated to be mailed to shareholders in mid March and will be available on BPP’s website and at www.sedar.com. In addition, a meeting of shareholders to consider the transaction is expected to take place on April 9, 2010. If shareholders approve the transaction at the meeting, and the requisite court approval is obtained, it is anticipated that the transaction will be completed on or about April 14, 2010.

The Supplementary Information specifically states:

Existing preferred shares of BPP will not be assumed by the REIT

At present it is difficult to see what preferred shareholders will be getting in exchange for an affirmative vote on the transaction (I am assuming they get to vote, because it’s a CBCA Plan of Arrangement, similar to the BCE deal). I have eMailed BPP’s investor relations department, asking them to clarify whether BPP preferred shareholders will be voting as a class and whether there are any sweeteners in the deal for them.

Until they answer – or until the proxy documents come out! – I cannot take view on the best way for the Pref holders to vote. However, at first glance it appears that the preferreds will suddenly have all the disadvantages of a holding company investment (being farther from the actual money) with none of the advantages (diversification). This is normally worth a one-notch downgrade in credit.

BPP has three issues of shares outstanding: BPP.PR.G (1.8-million shares); BPP.PR.J (3.8-million) and BPP.PR.M (2.8-million). These are the Amazing Shares That Would Not Die, having been issued by Royal Trustco in 1985, 1986 and 1986, respectively, and changing their name from Gentra to BPO Properties effective 2001-5-7, following a name change from Royal Trustco 1993-6-18.

All three issues are tracked by HIMIPref™, all are relegated to the Scraps index on both credit and volume concerns. BPP.PR.G was last mentioned on PrefBlog in the post What is the yield of BPP.PR.G?. BPP.PR.J and BPP.PR.M were last mentioned in BPO & BPP: S&P Revises Outlook to Negative.

Update Dominion Bond Rating Service has announced:

Under DBRS methodology, the Transaction would typically result in a rating differential between BOPC LP and BPO, with BOPC LP attaining the higher of the two ratings. This is due to the fact that a majority of the assets reside at BOPC LP. However, DBRS believes that the structural issue is mitigated by the following:

(1) BPO currently has no senior unsecured debt.

(2) The articles of BPO will prohibit it from incurring any unsecured indebtedness for borrowed money, or guaranteeing any such indebtedness of any other person, other than indebtedness that is guaranteed by BOPC LP.

(3) In accordance with the Canadian Business Corporations Act, any revision to or removal of the corporate article containing the debt restriction will require approval by special resolution of the common shareholders. Note that BPC will hold all the common shares.

(4) This restriction will not affect the “grandfathered” status of the preferred shares.

DBRS also takes comfort in the fact that:

(1) BPO will receive a cash flow amount from its ownership in BOPC LP that is comparatively equal to the amount under the pre-REIT structure.

(2) BPO will have an investment in liquid REIT units and ownership in a high-quality office portfolio and will maintain certain income-producing assets (the Canadian Office Fund assets).

(3) Going forward, DBRS expects BOPC LP to maintain conservative debt levels and coverage ratios similar to previous levels achieved by BPO and that are consistent with the BBB rating category.

I believe that the reference to “grandfathered” is, to put it in technical language, some tax thing. If I’m right in this, the shares were issued prior to changes in the Income Tax Act which make the financing very attractive on an after-tax basis.

High Income Preferred Shares Corporation has announced:

that shareholders of the Corporation have approved a special resolution authorizing the amendment of the articles of the Corporation to provide for the early redemption by the Corporation of the Series 1 Shares (TSX:HPF.pr.a), Series 2 Shares (TSX:HPF.pr.b) and Equity Shares of the Corporation and to revise the redemption amount for each Series 1 Share and Series 2 Share that will be paid by the Corporation to the holders thereof upon such early redemption (collectively, the “Approved Amendments”). The Approved Amendments were described in detail in the notice of special meeting and management information circular dated January 26, 2010 that was provided to shareholders of the Corporation in connection with the special meeting.

It is expected that the Corporation will file articles of amendment to give effect to the Approved Amendments and that, subject to the approval of the applicable securities regulatory authorities and the Toronto Stock Exchange (“TSX”), the Series 1 Shares, Series 2 Shares and Equity Shares will be redeemed by the Corporation effective as of March 12, 2010.

Redemption of the Series 1 Shares

Each holder of Series 1 Shares will receive an aggregate payment equal to $27.80 for each Series 1 Share held by them, such amount representing (a) the original investment amount of $25.00 paid in respect of each Series 1 Share, plus (b) the amount of all declared but unpaid dividends payable to holders of the Series 1 Shares and any dividends accrued up to the planned redemption date of March 12, 2010.

The Series 1 Shares will be de-listed from the TSX upon the redemption thereof by the Corporation, or otherwise at such time and in such manner as required by the TSX.

Redemption of the Series 2 Shares

Each holder of Series 2 Shares will receive an aggregate payment equal to $16.46 per Series 2 Share, such amount representing (a) the original investment amount of $14.70 paid in respect of each Series 2 Share less $0.28 per share (such amount representing one-half of the expected costs, on a per share basis, of effecting the Approved Amendments and to wind up and terminate the Corporation), plus (b) the amount of all declared but unpaid dividends payable to holders of the Series 2 Shares and any dividends accrued up to the planned redemption date of March 12, 2010.

The Series 2 Shares will be de-listed from the TSX upon the redemption thereof by the Corporation, or otherwise at such time and in such manner as required by the TSX.

Redemption of the Equity Shares

All of the Equity Shares, which do not trade on any stock exchange, are held by the manger of the Corporation, Navina Asset Management Inc. (formerly, Lawrence Asset Management Inc.) (the “Manager”). If the Equity Shares are redeemed on March 12, 2010 as planned, the Manager will receive an aggregate payment of approximately $138,575, such amount representing $0. 43 per Equity Share. This amount reflects the residual proceeds of the Corporation’s portfolio after payment of all remaining accruals (including the accrued management fees of approximately $827,176) and after payment of the remaining portion of the expected costs of effecting the Approved Amendments and to wind up and terminate the Corporation. There are no distributions accrued on the Equity Shares.

About the Corporation:

The Corporation invests in a diversified portfolio consisting principally of common shares issued by corporations whose shares are included in the S&P 500 Index and the S&P/TSX 60 Index, income funds and investment grade debt securities. Navina Asset Management Inc. (formerly, Lawrence Asset Management Inc.) is both manager and investment manager of the Corporation.

We’ll be well rid of these ridiculous vehicles, with the egregiously poor performance of the underlying portfolio against its benchmark!

HPF.PR.A and HPF.PR.B were last mentioned on PrefBlog when the early wind-up proposal was announced. HPF.PR.A and HPF.PR.B are tracked by HIMIPref™, but are relegated to the Scraps index on credit concerns.

Allbanc Split Corp. has announced:

that it has called 74,760 Preferred Shares for cash redemption on March 10, 2010 (in accordance with the Company’s Articles) representing approximately 6.579% of the outstanding Preferred Shares as a result of the special annual retraction of 74,760 Capital Shares by the holders thereof. The Preferred Shares shall be redeemed on a pro rata basis, so that each holder of Preferred Shares of record on March 9, 2010 will have approximately 6.579% of their Preferred Shares redeemed. The redemption price for the Preferred Shares will be $26.75 per share.

In addition, holders of a further 146,700 Capital Shares and 146,700 Preferred Shares have deposited such shares concurrently for retraction on March 10, 2010. As a result, a total of 221,460 Capital Shares and 221,460 Preferred Shares, or approximately 17.260% of both classes of shares currently outstanding, will be redeemed.

Holders of Preferred Shares that are on record for dividends but have been called for redemption will be entitled to receive dividends thereon which have been declared but remain unpaid up to but not including March 10, 2010.

Payment of the amount due to holders of Preferred Shares will be made by the Company on March 10, 2010. From and after March 10, 2010 the holders of Preferred Shares that have been called for redemption will not be entitled to dividends or to exercise any right in respect of such shares except to receive the amount due on redemption.

ABK.PR.B was last mentioned on PrefBlog when it was upgraded to Pfd-2(low) by DBRS. ABK.PR.B is not tracked by HIMIPref™.

General Growth Properties, Inc. has announced:

that it has reached an agreement in principle with Brookfield Asset Management Inc., one of the world’s largest real estate investors and asset managers, to invest in a proposed recapitalization of GGP at a plan value of $15.00 per share and provide par plus accrued interest to unsecured creditors. The $2.625 billion proposed equity commitment from Brookfield is not subject to due diligence or any financing condition and is expected to create a floor value for the purpose of raising additional equity for the company. The plan is subject to definitive documentation, approval of the Bankruptcy Court and higher and better offers pursuant to a bidding process to be approved by the Bankruptcy Court.

The complete term sheet for the proposed plan with Brookfield is available on GGP’s website at www.ggp.com/company/Default.aspx?id=97.

The proposed plan is designed to maximize value for all GGP stakeholders and enable a restructured GGP to emerge from bankruptcy on a standalone basis with a diverse portfolio of high-quality income-producing assets, strong cash flow and a solid balance sheet capitalized principally with long-term non-recourse debt.

Under the terms of the proposed plan:

• GGP’s existing shareholders will receive one share of new GGP common stock with an initial value of $10.00 per share, plus one share of General Growth Opportunities (“GGO”) with an initial value of $5.00 per share, for total consideration of $15.00 per share (see description of GGO below under “Terms of the Brookfield Investment and Proposed Recapitalization”)
• Unsecured creditors will receive par plus accrued interest
• Brookfield will invest $2.5 billion at $10.00 per share for new GGP common stock and up to $125 million at $5.00 per share for GGO common stock

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Under the terms of the proposal, Brookfield will invest $2.5 billion in cash in GGP in exchange for GGP common stock, thereby providing sufficient liquidity to fund GGP’s bankruptcy emergence needs. Brookfield will own approximately 30 percent of GGP and have the right to nominate three directors. This cornerstone investment will provide the flexibility for GGP to pursue additional capital-raising alternatives up to a total of $5.8 billion, including the issuance of new equity, asset sales and limited new debt issuance. Brookfield has agreed to assist GGP in raising the balance of this capital using its relationships with global institutional capital sources. As part of the restructuring, GGP intends to distribute to GGP shareholders shares in GGO, a new company that will own certain non-core assets, such as all of the company’s master planned communities and landmark developments like South Street Seaport and others. A shareholder must be invested in GGP prior to the recapitalization in order to receive a dividend of GGO. These assets produce little or no current income but have the potential for significant long-term value. GGO plans to raise $250 million through a rights offering at $5.00 per share, with Brookfield backstopping $125 million of such offering.
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As consideration for acting as “stalking horse” in the company’s process to raise capital, Brookfield will be granted seven-year warrants to purchase 60 million shares of existing GGP common stock at an exercise price of $15.00 per share. The warrants are intended to provide compensation to Brookfield for its financial commitment. Brookfield will not receive any other consideration or bid protection, including any break-up fee, expense reimbursement, commitment fee, underwriting discount or any other fees.

In my view, GGP deserved to go bankrupt, by the way. The website is in the “Techno-weenies go wild!” style, with little evidence of adult supervision. I guess the executives are all “big picture” guys.

The Globe & Mail reports:

Until the warrants are approved by a U.S. bankruptcy court, Brookfield has struck an unusual side deal with General Growth shareholder and noted US shareholder activist Bill Ackman. Until a bankruptcy court judge approves General Growth’s warrant offer with Brookfield, Mr. Ackman’s company Pershing Square Capital Management has agreed to provide interim protection. If Brookfield’s offer fails or is bested by another bidder, Pershing has agreed to pay Brookfield 25 per cent of its profits on any offer that exceeds $12.75 for each General Growth share.

Brookfield released acceptable 4Q09 Results on February 19, while stating that they were seriously looking for acquisitions.

Anyway, this has important implications for BAM’s credit rating. Where’s all this money going to come from? When DBRS confirmed their ratings in December, they stated:

Overall, DBRS remains concerned about Brookfield’s aggressive expansion program in these difficult market conditions, while some of its portfolios have come under pressure. Examples include (i) the $1 billion in capital allocated to a $5 billion Brookfield-managed consortium that will make large, opportunistic purchases of distressed real estate with good long-term prospects and (ii) the $1.1 billion restructuring of Babcock & Brown Infrastructure, in which the Company invested approximately $400 million. With these plans, the consolidated balance sheet (book value) is expected to well exceed the current $60 billion level (with 64% leverage).

Brookfield counters that the diversity of the investments, the use of investing partners, and non-recourse debt mitigates the risks to the Company at the corporate level. In fact, Brookfield’s share of assets on its deconsolidated balance sheet amounts to about $12 billion (with 27% leverage). In DBRS’s view, the Company’s mitigating arguments on how it scales investments are valid up to a point. However, there are limits after which the credit risks of growth exceed the growth of the consolidated balance sheet. Two byproducts of this strategy are the growing interest costs that have first claim on the related cash flow at the operating level and the growing refinancing risk for non-recourse borrowings (subsidiary and property-specific). Going forward, it is reasonable to consider that a large expansion program could very well have credit implications for Brookfield at the corporate level. In short, large transactions have the potential to negatively affect the Company’s credit ratings at the outset.

Stay tuned!

Update: DBRS comments:

Brookfield and the Consortium intend to hold the proposed investment rather than Brookfield Properties, which invests primarily in office properties. As noted in an earlier report, DBRS recognizes Brookfield’s strategy to make opportunistic investments in distressed assets, so long as it does not stress its balance sheet or liquidity. This investment appears to fit with the criteria Brookfield has set out previously.

Hence, DBRS views this plan as neutral to Brookfield’s ratings providing: (i) it enlists other co-investors to support and fund the plan, (ii) the cost of the investment remains at these levels, (iii) the remaining debt and any new debt at GGP is non-recourse to Brookfield and (iv) it maintains sufficient liquidity at the corporate level while completing the plan. At the end of Q3 2009, Brookfield had over $600 million in cash and financial assets on hand, as well as bank lines at the corporate level, plus access to ongoing cash flow and other forms of liquidity within the group.

Update, 2010-4-1: DBRS has concluded that the binding agreement subsequently negotiated is also neutral to credit.

Great-West Lifeco has announced:

that it intends to redeem all 7,938,500 of its outstanding 4.70% Non-Cumulative First Preferred Shares, Series D (the “Series D Shares”) on March 31, 2010. The redemption price will be $25.25 for each Series D Share plus an amount equal to all declared and unpaid dividends, net of any tax required to be withheld by the Company. A notice of redemption of the Series D Shares will be sent in accordance with the rights, privileges, restrictions and conditions attached to the Series D Shares.

GWO.PR.E was last mentioned on PrefBlog in the post GWO.PR.E / GWO.PR.X Issuer Bid Update, which in turn has been mentioned every time somebody asks me about buy-backs (for instance, Repurchase of Preferred Shares by Issuer and Potential for Buy-backs and Unscheduled Exchanges).

There’s another issue gone from the rapidly dwindling HIMIPref™ OperatingRetractible index!

Moody’s Investors Service has announced that it has:

downgraded its ratings on certain Canadian bank hybrid securities, in line with its revised Guidelines for Rating Bank Hybrids and Subordinated Debt published in November 2009. Moody’s downgraded the Canadian banks’ non-cumulative perpetual preferred securities and Innovative Tier 1 and Tier 2A Instruments, with the exception of the Bank of Montreal’s (BMO’s), for which the downgrade occurred in a previous rating action. This concludes the review for possible downgrade that began on November 19, 2009. All other ratings and outlooks for the Canadian banks and their subsidiaries remain unchanged.
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Prior to the global financial crisis, Moody’s had incorporated into its ratings an assumption that support provided by national governments and central banks to shore up a troubled bank would, to some extent, benefit the holders of bank subordinated capital as well as the senior creditors. The systemic support for these instruments has not been forthcoming in many cases. The revised methodology largely removes previous assumptions of systemic support, resulting in today’s rating action. In addition, the revised methodology generally widens the notching on a bank hybrid’s rating that is based on the instrument’s features.
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The starting point in Moody’s revised approach to rating hybrid securities is the Adjusted Baseline Credit Assessment (Adjusted BCA). The Adjusted BCA reflects the bank’s standalone credit strength, including parental and/or cooperative support, if applicable. The Adjusted BCA excludes systemic support. Moody’s rating action removes systemic support from Canadian bank hybrids and, where applicable, adds an additional rating notch for those instruments with non-cumulative coupon payments.
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RBC’s non-cumulative, perpetual preferred shares were downgraded to A2 from Aa2. These securities have a preferred claim in liquidation and their coupon payments are non-cumulative. Two notches of the downgrade reflect the removal of systemic support, while Moody’s added an additional notch to the downgrade to reflect the non-cumulative coupon payments. Thus, per Moody’s revised methodology for bank hybrids, the rating for these securities is three notches lower than the Adjusted BCA.
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TD’s non-cumulative, perpetual preferred shares were downgraded to A2 from Aa2. Please see the RBC section (non-cumulative preferred shares) for the rationale.
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Scotiabank’s non-cumulative, perpetual preferred shares were downgraded to A3 from Aa3. Please see the RBC section for the rationale.
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NBC’s non-cumulative, perpetual preferred shares were downgraded to Baa1 from A1. Please see the RBC section (non-cumulative preferred shares) for the rationale.
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CIBC’s non-cumulative, perpetual preferred shares were downgraded to Baa1 from A1. Please see the RBC section (non-cumulative preferred shares) for the rationale.
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Of note, Moody’s downgraded the long-term ratings of the Bank of Montreal (BMO) and all its subsidiaries on January 22, 2010. As part of this action, Moody’s completed the review for downgrade of BMO’s hybrid capital instruments. Moody’s downgraded BMO’s preferred stock securities (which include non-cumulative preferred shares and other hybrid capital instruments) four notches to Baa1 from Aa3. The first notch reflected the downgrade of BMO’s unsupported/stand-alone BFSR. The next three notches of the downgrade were a consequence of implementing Moody’s revised methodology for rating bank hybrid securities.

Please visit www.moodys.com to access the following documents for additional information:

Moody’s Special Comment: Canadian Bank Subordinated Capital Ratings — June 2009

Moody’s Guidelines for Rating Bank Hybrid Securities and Subordinated Debt — November 17, 2009

Frequently Asked Questions: Moody’s Guidelines for Rating Bank Hybrid Securities and Subordinated Debt — November 17, 2009

By way of comparison, Moody’s does not rate MFC, rates SLF preferreds at Baa2 and does not rate GWO, IAG or ELF.

Related posts on PrefBlog are Moody’s Downgrades BMO Prefs 4 Notches to Baa1 and Moody’s May Massacre Hybrid Ratings.

Financial 15 Split II Corp. has announced:

its regular monthly distribution of $0.04375 for each Preferred share ($0.525 annually). Distributions are payable March 10, 2010 to shareholders on record as at February 26, 2010. There will not be a distribution paid to Financial 15 II Class A Shares for February 26, 2010 as per the Prospectus which states no regular monthly dividends or other distributions will be paid on the Class A Shares in any month as long as the net asset value per unit is equal to or less than $15.00. The net asset value as of February 12, 2010 was $14.78.

The capital unit dividend was also suspended from November 2008 to July 2009, inclusive.

FFN.PR.A was last mentioned on PrefBlog when it was upgraded to Pfd-3(low) by DBRS. FFN.PR.A is tracked by HIMIPref™, but is relegate to the Scraps index on credit concerns.