Freddie Mac, 6.02% Non-Cumulative Perpetual Preferred Stock (FMCKL)

[radiumsoup]

yeah, I haven't been able to find info on what it would take to force dividends... I don't know if there are any triggers in the prosepctuses (prosepctii? ;P) which allow shareholders to demand dividends - but I don't recall seeing any such provisions when I did my initial DD in these... I think it's just a matter of "we'll pay them when we can and won't pay them when we can't... just trust us."

I think a lot of the Freddie dividends will be triggered by interest rates - when the interest rates go up, FMAC will make more and will be able to pay dividends again... and once they start being able to pay dividends, they'll be able to sell more preferred shares at lower rates, and can redeem the older higher-rate prefs with the proceeds, effectively refinancing the dividend payments, for lack of a better term.