Terms

Series

Fixed-Rate Reset Noncumulative Perpetual Preferred Stock, Series A

Liquidation Preference

$25.00

Coupon Rate

8%

Rate Type

Fixed To Floating

Annual Dividend

$2.00

Payment Frequency

Quarterly

Cumulative

No

Perpetual

Yes

Convertible

No

Callable

Yes

First Call Date

March 30, 2028

First Call Price

$25.00

Capital Stack Ranking

Junior To: All Existing And Future Indebtedness And Other Non-Equity Claims; Pari Passu With: Any Future Parity Preferred Stock; Senior To: Common Stock, Junior Stock

Regulatory (Basel III) Call

Yes

Tax Classification

Qualified Dividend

Qualifies for QDI

Yes

Qualifies for DRD

Yes

Depositary Share Fraction

0.001

Shares Offered

22,000,000

Prospectus Summary

Jackson Financial Inc. is offering 22,000,000 Depositary Shares (NYSE: JXN PR A), each representing a 1/1,000th interest in a share of its Fixed-Rate Reset Noncumulative Perpetual Preferred Stock, Series A, with a liquidation preference of $25 per Depositary Share. Dividends accrue at a fixed 8.00% per annum (equivalent to $2.00/year or $0.50/quarter per Depositary Share) until March 30, 2028, then reset every five years to the 5-year U.S. Treasury Rate plus 372.8 basis points. Crucially, dividends are non-cumulative: if the board does not declare a dividend for any period, that dividend is permanently lost and there is no obligation to make it up in future periods. The Series A Preferred Stock ranks senior to Jackson Financial's common stock and all other junior equity, and on parity with any future preferred stock the company may issue (absent a two-thirds preferred holder vote authorizing senior stock). However, it sits junior to all existing and future indebtedness — as of year-end 2022, the holding company had $2.6 billion in consolidated debt. Critically, Jackson Financial is a holding company whose sole source of cash is dividends from operating subsidiaries (primarily insurance companies), meaning the preferred is structurally subordinated to all policyholder and creditor claims at the subsidiary level ($268 billion in combined subsidiary liabilities). The issuer may redeem the preferred early (whole only) within 90 days of a 'regulatory capital event' at par ($25), or within 90 days of a 'rating agency event' at $25.50 per Depositary Share. At the $25 offering price, the initial yield is exactly 8.00% annually. Dividends are paid quarterly on March 30, June 30, September 30 and December 30, commencing June 30, 2023. For non-corporate U.S. holders who satisfy applicable holding period requirements, dividends are expected to qualify for the preferential 15%/20% qualified dividend income (QDI) tax rate; corporate holders may be eligible for the dividends-received deduction (DRD), though this depends on the company having sufficient current or accumulated earnings and profits. The dividend stopper restricts payments on common and junior stock if the prior quarter's preferred dividend was not fully paid — but since the preferred itself is non-cumulative, a missed preferred dividend creates no catch-up obligation for the issuer, posing a key income risk for investors.

Summarized from the SEC prospectus filing.

Distribution History

Floating Rate Terms

Ranking vs. Other Preferreds

Dividend Stopper Provisions

Dividend Stopper Description

If the full prior-period dividend on the Series A Preferred Stock has not been declared and paid, Jackson Financial may not pay dividends on or repurchase its common stock or any other junior stock, and may not redeem parity preferred stock except on a pro-rata basis.

Div Score Breakdown

Reinvesty's multi-factor safety analysis for this preferred, composite score: 43 (Average)