DBRS Downgrades 26 Split-Share Preferreds

At last! The DBRS mass reviews of Split-Share preferreds announced in October and December have been resolved. DBRS has announced:

today downgraded 26 ratings of structured Preferred Shares issued by various split share companies or trusts. Each of these split share companies or trusts has invested in a portfolio of securities (the Portfolio) funded by issuing two classes of shares – dividend-yielding preferred shares or securities (the Preferred Shares) and capital shares or units (the Capital Shares). The Preferred Shares benefit from a stable dividend yield and downside protection on their principal via the net asset value (NAV) of the Capital Shares.

On October 24, 2008, and on December 19, 2008, DBRS placed the Preferred Shares listed below (among others) Under Review with Negative Implications. Each of the Preferred Shares has experienced considerable declines in downside protection during the past number of months amidst tremendous volatility in global equity markets. DBRS has today taken final rating action on these 26 Preferred Shares ratings based on longer-term trends being established for the NAVs of the affected split share companies. Ratings assigned are also dependent on structural features benefiting the Preferred Shares and the credit quality and management of the Portfolios. For many of the split share companies listed below, distributions to holders of the Capital Shares are now suspended due to the failure of asset coverage tests. This feature ensures greater excess income for the Company and decreases the reliance on other income-generating methods such as option writing when downside protection has been significantly reduced.

In the future, DBRS will continue to closely monitor changes in the credit quality of these Preferred Shares. If the various Portfolios appreciate in value significantly, rating upgrades may be considered. However, any upward movement may be constrained depending on the possibility of increased distributions to the holders of the Capital Shares.

I have not yet reviewed the changes … more later.

Later:

DBRS Review Announced 2008-10-24
Ticker Old
Rating
Asset
Coverage
Last
PrefBlog
Post
HIMIPref™
Index
New
Rating
FBS.PR.B Pfd-2(low) 1.0+:1
1/12
Review-Negative SplitShare Pfd-4
ASC.PR.A Pfd-2(low) 0.7+:1
2/13
Downgrade
11/6
Scraps Pfd-5
11/6
ALB.PR.A Pfd-2(low) 1.1-:1
2/12
Dividend Policy SplitShare Pfd-4
BSD.PR.A Pfd-2(low) 0.9-:1
2/6
Issuer Bid InterestBearing Pfd-5
12/5
CIR.PR.A Pfd-4(low) 0.5+:1
2/13
Downgrade
11/6
None Pfd-5
11/6
CBW.PR.A Pfd-5 0.7+:1
10/24
Downgraded
11/6
None Pfd-5
11/6
DF.PR.A Pfd-2 1.4-:1
1/30
Review-Negative Scraps Pfd-3(low)
DGS.PR.A Pfd-2 1.3+:1
2/12
Review-Negative None Pfd-3(low)
ES.PR.B Pfd-3(high) 1.0-:1
2/12
Review-Negative None Not Resolved
FCS.PR.A Pfd-2 1.2-:1
2/12
Partial Redemption None Pfd-4
GFV.PR.A Pfd-2 1.4+:1
2/12
Dividend Policy None Pfd-3
GBA.PR.A Pfd-5 0.4-:1
2/12
Dividend Policy None Pfd-5(low)
11/6
HPF.PR.A Pfd-2(low) Their Numbers Note Calculation Dispute Issuer Bid Scraps Affirmed
12/5
HPF.PR.B Pfd-4 Their Numbers Note Calculation Dispute Issuer Bid Scraps Pfd-5(low)
12/5
FIG.PR.A Pfd-2 1.1-:1
2/12
Rights Offer Cancelled InterestBearing Pfd-5
PIC.PR.A Pfd-3(high) 1.1-:1
2/5
Review Negative Scraps Pfd-5
NBF.PR.A Pfd-2(low) 1.1-:1
2/12
Downgrade None Pfd-4(low)
12/23
SLS.PR.A Pfd-2(low) 0.9-:1
2/12
Partial Redemption None Pfd-4(low)
12/5
SNH.PR.U Pfd-3(high) N/A Maturity None Pfd-5(high)
12/5
SNP.PR.V Pfd-2(low) 1.2+:1
2/12
Review-Negative None Pfd-4(high)
YLD.PR.A Pfd-3 0.8-:1
1/30
Downgraded Scraps Pfd-5
11/6
TXT.PR.A Pfd-3(high) 1.1+:1
2/5
Review-Negative None Pfd-4(low)
WFS.PR.A Pfd-2(low) 1.1+:1
2/5
Issuer Bid SplitShare Pfd-4(low)

DBRS Review Announced 2008-12-19
Ticker Old
Rating
Asset
Coverage
Last
PrefBlog
Post
HIMIPref™
Index
New
Rating
ABK.PR.B Pfd-2(low) 1.3-:1
2/12
Review-Negative None Pfd-3
TDS.PR.B Pfd-2(low) 1.4-:1
2/12
Review-Negative Scraps Pfd-3
FTN.PR.A Pfd-2 1.2+:1
1/30
Dividend Policy SplitShare Pfd-4
BMT.PR.A Pfd-2(low) 1.1+:1
2/12
Dividend Policy Scraps Not Resolved
MST.PR.A Pfd-2(low) 1.3+:1
12/18
Review Negative Scraps Not Resolved
FFN.PR.A Pfd-2(low) 1.1-:1
1/30
Review-Negative SplitShare Pfd-5(high)
EN.PR.A Pfd-2(low) 1.5-:1
2/12
Review-Negative Scraps Pfd-3
BXN.PR.B Pfd-2(low) 1.8+:1
2/12
Review-Negative None Pfd-3(high)
PPL.PR.A Pfd-2 1.3+:1
1/30
Review-Negative SplitShare Pfd-3
LSC.PR.C Pfd-2 1.2+:1
2/12
Dividend Policy None Pfd-3
BSC.PR.A Pfd-2(low) 1.5-:1
2/12
Review-Negative None Pfd-3
SBC.PR.A Pfd-2 1.4-:1
2/12
Review-Negative SplitShare Pfd-3
PDV.PR.A Pfd-2 1.4-:1
1/30
Review-Negative None Pfd-3
SOT.PR.A Pfd-2(low) 1.5+:1
2/12
Review-Negative None Pfd-3(high)
BBO.PR.A Pfd-2 1.6-:1
2/13
Review-Negative None Pfd-3(high)
LBS.PR.A Pfd-2 1.3-:1
2/12
Dividend Policy SplitShare Pfd-3(low)
RBS.PR.A Pfd-2(low) 1.1-:1
2/12
Review-Negative None Not Resolved
LCS.PR.A Pfd-2 1.1+:1
2/12
Review-Negative None Pfd-4

19 Responses to “DBRS Downgrades 26 Split-Share Preferreds”

  1. […] Preferreds fell in sympathy with common, but to nowhere near the same extent, a refreshing change from the horror of 4Q08. The fall was led by split-shares, perhaps due to their direct exposure to equity prices, perhaps in response to the mass downgrade. […]

  2. […] is not tracked by HIMIPref™. It was last mentioned on PrefBlog when the DBRS Mass Downgrade of Feb 13 left the issue under review and […]

  3. […] is not tracked by HIMIPref™. It was last mentioned on PrefBlog when the DBRS Mass Downgrade of Feb 13 left the issue under review and […]

  4. […] is tracked by HIMIPref™. It was last mentioned on PrefBlog when the DBRS Mass Downgrade of Feb 13 left the issue under review and unresolved. It is included in the “Scraps” subIndex due […]

  5. […] was last mentioned on PrefBlog when it was downgraded to Pfd-5 in the DBRS Mass Downgrade of February 13. It is currently tracked by HIMIPref™ as part of the InterestBearing subIndex, but will […]

  6. […] was last mentioned on PrefBlog when it was downgraded to Pfd-3 as part of the DBRS Mass Downgrade of Split-Shares. ABK.PR.B is not tracked by […]

  7. […] was last mentioned on PrefBlog when it was downgraded to Pfd-3 by DBRS. It is tracked by HIMIPref™ and is a member of the “Scraps” […]

  8. […] Downgraded Feb. 13. Removed from SplitShare index in February 2009 Rebalancing. Asset coverage of 0.9+:1 as of February 27, according to the company. Now with a (somewhat dubious) pre-tax bid-YTW of 16.56% based on a bid of 5.95 and a hardMaturity 2014-12-1 at (a somewhat dubious) 10.00. […]

  9. […] was last mentioned on the post regarding the DBRS Mass Downgrade of SplitShares, at a time when its asset coverage was 0.5+:1. The issue had been downgraded to Pfd-5(low) in […]

  10. […] was last mentioned on PrefBlog when it was downgraded to Pfd-3 by DBRS. SBC.PR.A is tracked by HIMIPref™ but was relegated to the “Scraps” index at the […]

  11. […] was last mentioned on PrefBlog when it was downgraded to Pfd-4 by DBRS as part of the February mass-downgrade. It is tracked by HIMIPref™, but has been relegated to […]

  12. […] NBF.PR.A is not tracked by HIMIPref™ since the issue size is too small. It was last mentioned on PrefBlog when it was downgraded to Pfd-4(low) by DBRS. […]

  13. […] was last mentioned on PrefBlog when it was downgraded to Pfd-5(low) by DBRS in February. GBA.PR.A is not tracked by […]

  14. […] was downgraded to Pfd-3 in the recent DBRS Mass Downgrade, which was the last mention of this issue on […]

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