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Lincoln National: Financial Winners & Losers

Lincoln National said it will repurchase $950 million of preferred shares issued under the Treasury's Capital Purchase Program.



) --

Lincoln National

(LNC) - Get Report

was among the winners of the financial sector after the company announced plans to repay $950 million in bailout funds to the U.S. government.

Lincoln National

shares rose after the insurer said it will offer $335 million of common stock and up to $750 million of senior notes to fully repurchase the $950 million of Lincoln Financial's preferred shares issued to the U.S. Treasury under the Treasury's Capital Purchase Program.

Following the repayment, the Treasury will continue to hold warrants to purchase approximately 13 million shares of Lincoln Financial's common stock at an exercise price of $10.92 per share. The company said it does not intend to repurchase the warrants.

Lincoln National shares were lately up $1.64, or 6.2%, to $28, making it one of the top percentage gainers in the financial sector Monday.

Among other insurer stocks trading higher,

Hartford Financial

(HIG) - Get Report

rose 5% to $25.22,

American International Group

(AIG) - Get Report

gained 4.7% to $36.72, and


(MET) - Get Report

tacked on 1.9% to $41.86

Most other U.S. bank stocks were trading higher.


(C) - Get Report

was up 1% to $3.92,

Bank of America

(BAC) - Get Report

gained 0.7% to $15.70,

Goldman Sachs

TST Recommends

(GS) - Get Report

advanced 0.5% to $136.25,

JPMorgan Chase

(JPM) - Get Report

inched 0.1% higher to $38.13, and

Wells Fargo

(WFC) - Get Report

was up 0.1% to $27.86

On the downside,

Morgan Stanley

(MS) - Get Report

slipped 0.1% to $25.97

The movement in bank stocks came as

derivatives reform proposals

put forth by Sen. Blanche Lincoln (D-Ark.) have a chance at passing. Lincoln's plan would likely require banks to spin off their swaps businesses, which represent the bulk of their derivatives operations.


Dan Freed reports that the overall impact of the changes on banks is still somewhat unclear. But as Lincoln's proposals gain steam, the likelihood that it will be as bad for giant institutions like Goldman, JPMorgan, Citigroup and Bank of America as many originally imagined appears to be diminishing, Freed says.


Marsh & McLennan

(MMC) - Get Report

shares rose 4.1% to $22.99 after its Mercer subsidiary agreed Friday to pay $500 million to Alaska to settle a lawsuit over the state's unfunded employee pension plans.

-- Written by Robert Holmes in Boston


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