Banks firm ahead of CCAR results; Arlington Asset plans $25-par notes; American Realty up

By Stephanie N. Rotondo

Phoenix, March 11 – The preferred stock market was muted in Wednesday trading as investors prepared for the release of the Federal Reserve’s Comprehensive Capital Analysis and Review of U.S. banks after the market closed.

“After they announce [the results], that could change things,” a trader said, noting that it could spur the primary market to start kicking out new deals.

The results showed that 26 banks passed the test without qualification, including Citigroup Inc., which failed the year before. Bank of America Corp. also passed, though it needs to make certain adjustments and resubmit its capital plan by Sept. 30.

Three other banks – JPMorgan Chase & Co., Goldman Sachs Group Inc. and Morgan Stanley & Co. Inc. – passed after revising their proposals.

However, the U.S. units for Deutsche Bank AG and Banco Santander SA failed. Santander also failed the year before.

Meanwhile, Arlington Asset Investment Corp. announced a $25 million offering of $25-par senior notes due March 2025 (expected ratings: BBB) on Wednesday.

Price talk is 6.75%, according to a trader.

RBC Capital Markets is the bookrunning manager.

Also, American Realty Capital Properties Inc.’s 6.7% series F cumulative redeemable preferreds (Nasdaq: ARCPP) gained 8 cents to close at $23.58 Wednesday as investors reacted to news out late Tuesday regarding the appointment of a new chief executive officer.

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