Replies to post #11679 on Lehman Brothers Financial SA (LEHNQ)

[JERSEYHAWG]

LDEVIL, I enjoy your posts and your thought process on stuff and the way you lay it down.

BUT,,, the person you had on the horn giving you this information. How can you be sure what they say? Sometimes you get a diamond on the other side and sometimes a sap

Who knows, go figure

BTW, keep up your posts, good stuff and good luck

[jwnoble3]

The rank of the CTs in relation to equity are found in the prospectus for each

They rank on parity to the most SR preferred and SR to common

[toogoodfella]

Ct's are Ct's and is standard in the industry so you don't need to prove anything about it..
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Trust-preferred security
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A trust-preferred security is a security possessing characteristics of both equity and debt issues. A company creates trust-preferred securities by creating a trust issuing debt to the new entity, while the trust issues the trust preferred securities. Trust-preferred securities are generally issued by bank holding companies.

The security is a hybrid security with characteristics of both subordinated debt and preferred stock in that it is generally very long term (30 years or more), allows early redemption by the issuer, makes periodic fixed or variable interest payments, and matures at face value. In addition, trust preferred securities issued by bank holding companies will usually allow the deferral of interest payments for up to 5 years.

The principal advantages of these hybrid characteristics are favorable tax, accounting, and credit treatment. Trust preferred securities have an additional advantage over other types of hybrid securities (such as similar types of debt issued directly to investors without the intervening trust), which is that if they are issued by a bank holding company, they will be treated as capital (equity/own funds) rather than as debt for regulatory purposes. This is why trust preferred securities are issued overwhelmingly by bank holding companies, even though any company can issue them.

[hestheman]

Littledevils....there is really no need for anyone to call. This info is easily/readily available on the internet. IN ALL CASES, trust preferred stock is allways classified as debt in bankruptcy court. Allthough, before the chap 11 we were classified as tier 1 equity.