This is a routine debt capital raise that modestly increases leverage but provides optionality to refinance higher-cost preferred equity. The 6.800% coupon is fixed for 10 years, then resets to 5-year Treasury + 240 bps. Monitor for any preferred stock redemption announcements (Series C or D) which would be credit-positive for common equity holders by reducing preferred dividend obligations. The interest deferral feature and limited event-of-default provisions make this a hybrid capital instrument — watch for any rating agency actions on the equity credit assigned to these notes.
Price Chart
Executive Summary
Lincoln National Corporation completed a $500M registered public offering of 6.800% Fixed-to-Fixed Reset Rate Subordinated Notes due 2056, raising $495M in net proceeds. The company intends to use the proceeds for general corporate purposes, which may include repurchasing/redemption of up to $1B in outstanding preferred stock (Series C and Series D). This is a routine debt capital raise that modestly increases leverage but provides optionality to refinance higher-cost preferred equity.
Key Facts
- Lincoln National issued $500M aggregate principal amount of 6.800% Fixed-to-Fixed Reset Rate Subordinated Notes due 2056
- Net proceeds to the company are $495M (99% of par, after 1% underwriting discount)
- Interest rate is 6.800% through July 15, 2036, then resets to 5-year Treasury rate plus 240 bps every five years
- Notes mature July 15, 2056 and are subordinated unsecured obligations
- Proceeds may be used to repurchase/redeem up to $1B in outstanding preferred stock (Series C and Series D), both redeemable on or after December 1, 2027
- The company has the right to defer interest payments for up to five years per deferral period
- Event of default is limited to bankruptcy, insolvency, or receivership — no acceleration for payment defaults
- Underwriters include Wells Fargo, BofA, Goldman Sachs, Morgan Stanley, TD Securities, Deutsche Bank, and PNC Capital Markets
Financial Impact
$500M in new subordinated debt issued; net proceeds of $495M after 1% underwriting discount. Proceeds may be used to redeem up to $1B in preferred stock (Series C and Series D), each with $500M stated value.
Risk Factors
- Increased leverage from $500M in new subordinated debt
- Interest deferral feature could signal financial stress if ever exercised
- Limited event-of-default provisions (bankruptcy/insolvency only) reduce bondholder protections
- Proceeds used to redeem preferred stock would reduce equity cushion for common holders
Market Snapshot
Investment Themes
Documents Analyzed
This report is based on 8 SEC documents filed with EDGAR.
| Document | Accession Number |
|---|---|
| 8-K Filing (Primary) | 0001193125-26-288480 |
| Document: d146146dex42.htm | 0001193125-26-288480 |
| Document: d146146d8k.htm | 0001193125-26-288480 |
| Document: d146146dex51.htm | 0001193125-26-288480 |
| Document: d146146dex52.htm | 0001193125-26-288480 |
| Document: 0001193125-26-288480-index-headers.html | 0001193125-26-288480 |
| Document: 0001193125-26-288480-index.html | 0001193125-26-288480 |
| Document: 0001193125-26-288480.txt | 0001193125-26-288480 |
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| Type | Now | ||||
|---|---|---|---|---|---|
Aug 18, 2026 6w ago | Insider Cluster | $45.08 $42.45 | ▼ −5.83% | ▼ −4.52% | $39.92 (−11.45%) |
Aug 10, 2026 7w ago | 8-K | $45.68 $43.32 | ▼ −5.17% | ▼ −4.25% | $39.92 (−12.61%) |
Jun 29, 2026 13w ago | 8-K | $35.35 $41.20 | ▲ +16.55% | ▲ +17.58% | $39.92 (+12.93%) |
Jun 10, 2026 16w ago | Court Ruling | $36.21 $39.50 | ▲ +9.09% | ▲ +5.46% | $39.92 (+10.25%) |
May 7, 2026 21w ago | 8-K | $26.70 $26.44 | ▼ −0.97% | ▼ −4.10% | $39.92 (+49.52%) |
Apr 16, 2026 24w ago | 8-K | $26.32 $26.02 | ▼ −1.15% | ▼ −6.52% | $39.92 (+51.67%) |
Apr 16, 2026 24w ago | DEFA14A | $26.35 $26.61 | ▲ +0.99% | ▼ −4.83% | $39.92 (+51.50%) |
Mar 9, 2026 29w ago | Insider Cluster | $33.89 $34.79 | ▲ +2.66% | ▲ +5.46% | $39.92 (+17.81%) |
Mar 2, 2026 30w ago | EFFECT | $34.48 $34.07 | ▼ −1.19% | ▲ +6.75% | $39.92 (+15.79%) |
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