Why aren't these trading very near the BAC preferreds (19-20) after that press release of the delisting and relisting? I thought it was pretty definitive that BAC is saying they are behind these. Is there anyone here who still thinks there is extra risk attached to cfc-pa/b compared to say bac-px ?
The A and B have slightly different structures, which I always thought accounted for the 'premium' of the A.
Let's see what happens over the next week. Could be this bank injection by the Fed changed something I'm not aware of, or it may be a large seller that is willing to take a small discount to get out. Both of these are trading very large volume and blocks this week
I swear I looked for previous posts on this thread mentioning the ex-div date before I just posted that, and they weren't there. But clearly they were. Sorry for duplicating what some others of you posted. . . .
Well, it could have been worse. As of this moment -- midmorning Tuesday -- it looks like the banks WILL still be allowed to pay dividends to shareholders on already-existing preferred.
For about an hour there before the market opened I about lost my cool, because Steve Liesman on CNBC said he was reading one statement to make it look like banks participating with the government would have to SUSPEND PAYMENT OF DIVIDENDS ON EXISTING PREFERRED. Since I have considerable CFC-B, BAC-W and CNB-B, I thought I was headed to Skid Row in a hurry, both with a wipeout in the share price and the loss of the dividend income.
Turns out what Mr. Liesman was reading did in fact exist, BUT apparently there was a following paragraph that said the dividends would have to be suspended "unless. . . ." And the "unless" seems to say it's fine to pay the divs as long as the banks also pay the agreed upon divs to the government in this new program. If they didn't do that, there would of course be a whole lot of other problems, so they are expected to do that. So for now, our divs should be fine.
This got clarified right at market opening, and most bank preferred opened UP in share price. For now, even if we just got subordinated, I feel better. . . .