VLYPP - Valley National: Risk Keeps Me Sidelined From High Yielding Preferred Shares
2024-06-03 16:00:44 ET
Summary
- Valley National Bancorp's stock is approaching a 52-week low due to struggles with high interest rates and issues in the banking sector.
- The bank has two preferred share offerings with high yield dividends, but there are risks to volatility here too.
- Risks include exposure to commercial real estate, low allowance for credit losses, high level of uninsured deposits, and a problematic loan to deposit ratio.
Valley National Bancorp ( VLY ) is a regional bank that has seen its share of struggles as it relates to high interest rates and troubles within the banking sector. The bank’s stock recently sold off and is approaching a 52-week low. Additionally, the bank has two preferred share offerings ( VLYPO ) ( VLYPP ) that each pay high yield dividends. VLYPO is currently yielding 9.55% on a floating rate while VLYPP is paying 6.9% and scheduled to float next June at a rate of over 10% if interest rates remain at their current levels. Last year, I analyzed why I was avoiding the bank . Based on the recent financial statements, I am still choosing not to participate in any of the share offerings....
Valley National: Risk Keeps Me Sidelined From High Yielding Preferred Shares