The math on this is pretty simple. $5.5B at a blended rate of 8.4% comes to an annual $462M interest savings.....if we take it a step further assuming $5B in common gets bought back in '13, just the interest savings here can double the dividend in 2014 ($5B buyback reduces shares to ~10.3B/$462M = $.04/share).
Bank of America Announces Redemption of All Outstanding Depositary Shares Representing Interests in Its 8.20% Non-Cumulative Preferred Stock, Series H, and Its 8.625% Non-Cumulative Preferred Stock, Series 8
View printer-friendly versionCHARLOTTE, N.C.--(BUSINESS WIRE)--Apr. 1, 2013-- Bank of America Corporation announced today that it has submitted redemption notices for its 8.20% Non-Cumulative Preferred Stock, Series H (the Series H Preferred Stock), and the corresponding depositary shares representing fractional interests in the Series H Preferred Stock (the Series H Depositary Shares), and its 8.625% Non-Cumulative Preferred Stock, Series 8 (the Series 8 Preferred Stock), and the corresponding depositary shares representing fractional interests in the Series 8 Preferred Stock (the Series 8 Depositary Shares).
The Series H Depositary Shares (NYSE: BAC.PrH) (CUSIP No. 060505765), each representing a 1/1,000th interest in one share of the Series H Preferred Stock, and the Series 8 Depositary Shares (NYSE: BML.PrQ) (CUSIP No. 060505559), each representing a 1/1,200th interest in one share of the Series 8 Preferred Stock, will be redeemed at a redemption price of $25 per depositary share.
All 114,482,182 Series H Depositary Shares currently outstanding will be redeemed on May 1, 2013 for an aggregate redemption price of $2,862,054,550, and all 106,920,000 Series 8 Depositary Shares currently outstanding will be redeemed on May 28, 2013 for an aggregate redemption price of $2,673,000,000.
Since the redemption dates for the Series H Depositary Shares and the Series 8 Depositary Shares are also dividend payment dates, the applicable redemption price of $25 per depositary share does not include any declared and unpaid dividends. Dividends on the Series H Depositary Shares for the full current quarterly dividend period from and including February 1, 2013 to but excluding May 1, 2013 (which have not yet been declared) will be paid separately in the customary manner on May 1, 2013 to holders of record on April 15, 2013. Dividends on the Series 8 Depositary Shares for the full current quarterly dividend period from and including February 28, 2013 to but excluding May 28, 2013 (which have not yet been declared) will be paid separately in the customary manner on May 28, 2013 to holders of record on the record date fixed by Bank of America's Board of Directors.
The depositary shares are held through the Depository Trust Company (DTC) and will be redeemed in accordance with the procedures of DTC. Payment to DTC for the Series H Depositary Shares will be made by Computershare Inc. and Computershare Trust Company, N.A., collectively as redemption agent, in accordance with the Deposit Agreement governing the Series H Depositary Shares. Payment to DTC for the Series 8 Depositary Shares will be made by The Bank of New York Mellon, as redemption agent, in accordance with the Deposit Agreement governing the Series 8 Depositary Shares. The addresses for the redemption agents are as follows:
Series H Depositary Shares:
Computershare Trust Company, N.A.
Attn: Corporate Actions
250 Royall St.
Canton, MA 02021
Series 8 Depositary Shares:
The Bank of New York Mellon
Global Corporate Trust
111 Sanders Creek Parkway
East Syracuse, NY 13057
Bank of America has received all necessary approvals for these redemptions.
In addition, Bank of America announced that it will submit a redemption notice to the property trustee for Progress Capital Trust II, which will result in the redemption of $6 million aggregate liquidation amount outstanding of the 11.445% Preferred Securities (CUSIP No. NC0005842) of Progress Capital Trust II. The redemption date for these securities will be May 1, 2013, and the cash redemption price to be paid on the redemption date will be $1,045.78 plus accumulated and unpaid distributions per preferred security to the redemption date of $32.4275.
