The first CIT bankruptcy hearing was today:
CIT won permission today to carve out an exception for Icahn from an order to that bars trading in its debt for the purpose of preserving as much as $7 billion in tax benefits. Icahn, CIT’s largest holder, could complicate the recognition of so-called net operating losses for taxes as he holds more than 5 percent of CIT’s debt. He is in the middle of a tender offer that could give him about 11 percent of the company’s stock upon its exit from bankruptcy, according to court documents.
The preferred share market had another strong day today, with PerpetualDiscounts up 38bp and FixedResets gaining 28bp. I wish I could be a more interesting commentator and claim that this was a clear reaction to the Lloyds Contingent Capital issue and the realization that the terms on new preferred share issues are probably going to become less investor-friendly over time … but I don’t believe the market is that sophisticated and I’m not an interesting commentator, so there!
Volume was muted again today.
| HIMIPref™ Preferred Indices These values reflect the December 2008 revision of the HIMIPref™ Indices Values are provisional and are finalized monthly |
|||||||
| Index | Mean Current Yield (at bid) |
Median YTW |
Median Average Trading Value |
Median Mod Dur (YTW) |
Issues | Day’s Perf. | Index Value |
| Ratchet | 0.00 % | 0.00 % | 0 | 0.00 | 0 | 0.7431 % | 1,476.4 |
| FixedFloater | 6.59 % | 4.64 % | 46,335 | 17.99 | 1 | 1.4136 % | 2,363.9 |
| Floater | 2.64 % | 3.11 % | 95,776 | 19.44 | 3 | 0.7431 % | 1,844.4 |
| OpRet | 4.83 % | -11.11 % | 119,873 | 0.09 | 14 | -0.0493 % | 2,295.4 |
| SplitShare | 6.38 % | 6.41 % | 434,009 | 3.92 | 2 | 0.3973 % | 2,074.4 |
| Interest-Bearing | 0.00 % | 0.00 % | 0 | 0.00 | 0 | -0.0493 % | 2,098.9 |
| Perpetual-Premium | 5.87 % | 5.64 % | 76,506 | 1.18 | 4 | -0.1184 % | 1,861.0 |
| Perpetual-Discount | 5.94 % | 5.97 % | 198,851 | 13.93 | 70 | 0.3828 % | 1,743.1 |
| FixedReset | 5.51 % | 4.16 % | 420,504 | 3.99 | 41 | 0.2840 % | 2,114.7 |
| Performance Highlights | |||
| Issue | Index | Change | Notes |
| BAM.PR.O | OpRet | -1.20 % | YTW SCENARIO Maturity Type : Option Certainty Maturity Date : 2013-06-30 Maturity Price : 25.00 Evaluated at bid price : 25.45 Bid-YTW : 4.63 % |
| NA.PR.N | FixedReset | -1.14 % | YTW SCENARIO Maturity Type : Call Maturity Date : 2013-09-14 Maturity Price : 25.00 Evaluated at bid price : 25.95 Bid-YTW : 4.23 % |
| RY.PR.C | Perpetual-Discount | -1.06 % | YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2039-11-03 Maturity Price : 19.64 Evaluated at bid price : 19.64 Bid-YTW : 5.87 % |
| PWF.PR.K | Perpetual-Discount | 1.00 % | YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2039-11-03 Maturity Price : 20.13 Evaluated at bid price : 20.13 Bid-YTW : 6.20 % |
| RY.PR.D | Perpetual-Discount | 1.03 % | YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2039-11-03 Maturity Price : 19.62 Evaluated at bid price : 19.62 Bid-YTW : 5.75 % |
| RY.PR.A | Perpetual-Discount | 1.04 % | YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2039-11-03 Maturity Price : 19.49 Evaluated at bid price : 19.49 Bid-YTW : 5.73 % |
| NA.PR.K | Perpetual-Discount | 1.10 % | YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2039-11-03 Maturity Price : 24.47 Evaluated at bid price : 24.79 Bid-YTW : 5.91 % |
| HSB.PR.D | Perpetual-Discount | 1.13 % | YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2039-11-03 Maturity Price : 21.49 Evaluated at bid price : 21.49 Bid-YTW : 5.90 % |
| ELF.PR.F | Perpetual-Discount | 1.15 % | YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2039-11-03 Maturity Price : 19.27 Evaluated at bid price : 19.27 Bid-YTW : 6.96 % |
| BNS.PR.K | Perpetual-Discount | 1.16 % | YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2039-11-03 Maturity Price : 20.85 Evaluated at bid price : 20.85 Bid-YTW : 5.80 % |
| BMO.PR.L | Perpetual-Discount | 1.17 % | YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2039-11-03 Maturity Price : 24.87 Evaluated at bid price : 25.10 Bid-YTW : 5.89 % |
| MFC.PR.C | Perpetual-Discount | 1.29 % | YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2039-11-03 Maturity Price : 18.80 Evaluated at bid price : 18.80 Bid-YTW : 6.08 % |
| POW.PR.A | Perpetual-Discount | 1.34 % | YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2039-11-03 Maturity Price : 22.34 Evaluated at bid price : 22.61 Bid-YTW : 6.25 % |
| SLF.PR.D | Perpetual-Discount | 1.36 % | YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2039-11-03 Maturity Price : 18.70 Evaluated at bid price : 18.70 Bid-YTW : 6.03 % |
| GWO.PR.I | Perpetual-Discount | 1.36 % | YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2039-11-03 Maturity Price : 18.66 Evaluated at bid price : 18.66 Bid-YTW : 6.12 % |
| BAM.PR.G | FixedFloater | 1.41 % | YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2039-11-03 Maturity Price : 25.00 Evaluated at bid price : 16.50 Bid-YTW : 4.64 % |
| CIU.PR.A | Perpetual-Discount | 1.43 % | YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2039-11-03 Maturity Price : 19.85 Evaluated at bid price : 19.85 Bid-YTW : 5.91 % |
| CM.PR.L | FixedReset | 1.49 % | YTW SCENARIO Maturity Type : Call Maturity Date : 2014-05-30 Maturity Price : 25.00 Evaluated at bid price : 27.86 Bid-YTW : 3.82 % |
| BAM.PR.B | Floater | 1.67 % | YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2039-11-03 Maturity Price : 12.76 Evaluated at bid price : 12.76 Bid-YTW : 3.11 % |
| SLF.PR.C | Perpetual-Discount | 1.78 % | YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2039-11-03 Maturity Price : 18.91 Evaluated at bid price : 18.91 Bid-YTW : 5.97 % |
| Volume Highlights | |||
| Issue | Index | Shares Traded |
Notes |
| RY.PR.B | Perpetual-Discount | 53,152 | YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2039-11-03 Maturity Price : 20.15 Evaluated at bid price : 20.15 Bid-YTW : 5.85 % |
| CM.PR.L | FixedReset | 48,378 | YTW SCENARIO Maturity Type : Call Maturity Date : 2014-05-30 Maturity Price : 25.00 Evaluated at bid price : 27.86 Bid-YTW : 3.82 % |
| MFC.PR.D | FixedReset | 38,055 | RBC crossed 30,000 at 28.00. YTW SCENARIO Maturity Type : Call Maturity Date : 2014-07-19 Maturity Price : 25.00 Evaluated at bid price : 27.82 Bid-YTW : 4.19 % |
| RY.PR.G | Perpetual-Discount | 37,400 | YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2039-11-03 Maturity Price : 19.45 Evaluated at bid price : 19.45 Bid-YTW : 5.80 % |
| TRP.PR.A | FixedReset | 34,871 | YTW SCENARIO Maturity Type : Call Maturity Date : 2015-01-30 Maturity Price : 25.00 Evaluated at bid price : 25.38 Bid-YTW : 4.38 % |
| BMO.PR.L | Perpetual-Discount | 31,800 | RBC crossed 25,000 at 25.00. YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2039-11-03 Maturity Price : 24.87 Evaluated at bid price : 25.10 Bid-YTW : 5.89 % |
| There were 30 other index-included issues trading in excess of 10,000 shares. | |||