JPMorgan was in the market in late July with a $2.25 billion preferred stock deal. The non-call five notes pay a fixed rate of 5% until August 1, 2024, and then switch to a floating rate of three-month term secured overnight financing rate (Sofr), plus a spread of 3.38%.
The only problem is that three-month term Sofr doesn’t exist.
This is the first bank capital trade to reference Sofr. Bank of America issued a $1.3 billion Series KK preferred deal at the end of June, but that was still benchmarked to Libor.
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