Bank of America Corp's Series H preferred stock, a 3% non-cumulative perpetual issue known by its trading symbol BML'H, has been eligible for redemption since November 28, 2009. Seventeen years later, the company still has not called it, and the security trades at $18.17 as of October 6, 2026, a 27.32% discount to its $25 liquidation preference. The gap, equal to $6.83 per share, is wider than the average 17.5% discount seen across a broader group of 96 preferred issues with comparable current-yield data, a comparison that first stood out in data tracked on Preferred Stock AI, a Madison Labs research site.
The persistence of that discount, despite the shares having been callable for nearly two decades, points to a basic mechanic of the preferred securities market. When a company issues a callable preferred, it reserves the right to redeem the shares at par starting on a set date, but it is under no obligation to do so. A 3% coupon locked in back in 2005, when the issue priced at $25 per share, is far below what Bank of America would need to offer investors in a new preferred issue today. Redeeming BML'H at $25 would force the bank to replace that capital with fresh preferred stock carrying a materially higher coupon, an economically unattractive trade for the issuer even though it would hand existing holders a return to full par value.
For investors holding or evaluating BML'H, the arithmetic cuts in more than one direction. The shares currently yield 4.13% based on the $0.75 annual dividend and the $18.17 market price, a yield that sits above the average for the peer group tracked alongside it, reflecting the deeper discount to par rather than any increase in the stated coupon. Because the security is callable immediately and perpetual in maturity, there is no yield-to-call figure to calculate and no fixed date by which the discount must close. Any eventual call would return $25 per share to holders regardless of where the stock trades beforehand, but Bank of America has given no indication of redemption plans, and no timeline for one is implied by its remaining outstanding this long after the call date passed.
BML'H traces back to March 14, 2005, when 40.8 million shares were offered under the Merrill Lynch name, years before Bank of America acquired Merrill Lynch during the 2008 financial crisis. The issue's $25 liquidation preference, quarterly payment schedule, and non-cumulative dividend structure are documented in the original SEC prospectus and remain unchanged. The "Merrill-era" label reflects that lineage: a batch of legacy preferred securities issued by Merrill Lynch that now sit on Bank of America's balance sheet as assumed obligations, many carrying coupons set for a pre-crisis interest rate environment.
The broader fixed-income backdrop adds context to why that 2005-vintage coupon looks so far out of step today. Treasury yields have been climbing as investors parse a heavy bond-supply calendar, with CNBC reporting rising yields tied to oil prices and an upcoming Treasury auction. A higher-rate environment of this kind generally depresses the market price of legacy fixed-rate preferreds relative to par, since newer issues must offer comparable or higher yields to attract buyers, pushing older low-coupon shares like BML'H deeper into discount territory. Bank of America's common stock, by contrast, closed at $54.09, up 0.17% on the day and within its 52-week range of $46.12 to $65.22, a reminder that the preferred and common shares of the same issuer can move on very different drivers.
Going forward, holders and prospective buyers of BML'H and similar legacy bank preferreds are likely to watch two things closely: the path of broader interest rates, which determines how attractive refinancing would be for Bank of America relative to leaving the 3% coupon in place, and any capital-management disclosures from the bank around its preferred stock stack, typically surfaced around quarterly earnings. Until either changes meaningfully, the structural logic that has kept BML'H uncalled for seventeen years remains in place, and the discount to par it has accumulated reflects that reality rather than any public plan for redemption.