Capital One Financial Corp. on Sept. 11 issued and sold 60 million depositary shares, each representing a 0.025 ownership interest in a share of the company's fixed-rate noncumulative perpetual preferred stock, series I.
The net proceeds of the offering were about $1.46 billion, after deducting underwriting commissions and estimated offering expenses. The company plans to use the net proceeds for general corporate purposes in the ordinary course of business, according to a prospectus supplement.
The liquidation preference is $25 per depositary share, which is equivalent to $1,000 per series I preferred share. Dividends on the preferred stock will accrue and be payable from the date of issuance at a rate of 5.00% per annum, payable quarterly in arrears on March 1, June 1, Sept. 1 and Dec. 1 of each year, starting Dec. 1, 2019.
At its option, the company may redeem the preferred shares, in whole or in part, from time to time, on any dividend payment date on or after Dec. 1, 2024. It may also redeem the preferred shares, in whole but not in part, at any time within 90 days following a regulatory capital treatment event. The preferred shares will be redeemed at a price equal to $1,000 per share, equivalent to $25 per depositary share, plus any declared and unpaid dividends.
Capital One Financial will apply to list the depositary shares on the NYSE under the symbol COFPRI. If the application is approved, trading of the depositary shares on the NYSE is expected to begin within the 30-day period following the original issuance date of the depositary shares.
In a pricing term sheet, the company listed BofA Securities Inc., J.P. Morgan Securities LLC, Morgan Stanley & Co. LLC, UBS Securities LLC and Wells Fargo Securities LLC as joint book-running managers for the transaction. Barclays Capital Inc., Citigroup Global Markets Inc., Credit Suisse Securities (USA) LLC and Goldman Sachs & Co. LLC were listed as co-managers.
