RE:BikipalJust the clarify, the minimum div for Preferred is ~5%. What it means by that is the Board of Directors can not reduce the preffered dividend to be below ~5%. There was no mention of a upper limit or what is the criteria is for incresing.
The next bit that I am going to say is some guess work based on discussions i have read in other platforms...
For the preffered for BK, they have a variable preffered dividend between min 5 - max 8% where the rate is determined by the prime rate plus 1.5%. Since prime is 7.2% they are already maxed out and are at 8%.
Based on this, FTN may be trying to keep the preffered share competitive vs a high interest savings account or other relatively safe dividend stocks. This may be due to the need to keep the 1-1 ratio of preffered and common shares. There may be a clause to reconcile the common shares if that 1-1 ratio is not maintained, If too many people retract the preffered shares.
I agree that increasing the div of the preffered in the current market and nav context that will increase the nav reduction of the commons seems like a bias. May need to go through all the document related to the 2020 extention meeting to understand the logic behind giving the Board of Directors this power and not be simple as what BK has implemented with upper limits