Morning Commentary: General Motors Financial, Santander UK plan to tap high-grade bond market

By Cristal Cody

Tupelo, Miss., Jan. 2 – The investment-grade bond market opened the first business day of the new year with at least two issuers planning to tap the primary market.

General Motors Financial Co., Inc. is offering three tranches of notes, including one tranche of floaters.

Santander UK plc is marketing two tranches of three-year fixed- and floating-rate notes.

Deal action is expected to be strong in January, according to market sources.

The three-month Libor yield was reported unchanged at 1.69% early Tuesday, a source said.

In the secondary market, the most recent offering of bonds that General Motors Financial (Baa3/BBB/BBB-) priced in November was mixed.

The company’s 2.45% notes due Nov. 6, 2020 were last seen in the secondary market on Friday at 99.30, a source said.

The $850 million tranche of notes priced on Nov. 2 at 99.925 to yield 2.476%, or a spread of 75 basis points over Treasuries.

A block of more than 1.2 million bonds of General Motors Financial’s 3.5% senior notes due Nov. 7, 2024 traded during the morning at 99.67, the source said.

The notes last traded on Friday at 100.50.

The Fort Worth-based finance subsidiary of General Motors Co. sold $750 million of the notes on Nov. 2 at 99.852 to yield 3.524%, or a spread of Treasuries plus 132 bps.

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