Is it smart for the government to be buying Preferred Bank shares?

Seems like a 10% discount to common share prices isn't good enough.

Answers

SallyG answered a question in Financial Services.
457 points

SallyG answered 9 months ago …

The advantage (theoretically, at least, as I understand it), is that the dividends are higher, less able to be cut or eliminated, and holders of preferred shares are higher up the food chain if a company should go bankrupt. It is a better move than buying common stock, bondholders are even higher in the food chain than PS holders (but have no ownership or influence). If a move had to be made (I'm still not convinced), it was probably the right one, IMHO.

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