Primary issuance quiet as late-summer lull sets in; Santander better; Broadridge unchanged

By Cristal Cody and Aleesia Forni

Virginia Beach, Va., Aug. 26 - Monday's high-grade primary market was muted to kick off the last week of August, with no new deals pricing during the session.

Sources are predicting light activity for the remainder of the week, though there is the possibility of a small number new deals pricing during the late-summer lull.

One market source noted that with the market's positive tone, he doubts the primary will see a full week with no new deals pricing.

"But we'll see," he added.

However, the primary's pause is expected to only last until the end of the month, and issuance is predicted to come back in full force at the beginning of September.

Secondary volume stayed light over the session, with activity expected to be quiet as August closes, sources said.

"This will probably be the quietest week and then things will start to get normal," a trader said earlier in the day.

Going out on Monday, Santander Holdings USA Inc.'s 3.45% senior notes due 2018 firmed 1 basis point on the bid side in the secondary market, a trader at another desk said.

Broadridge Financial Solutions, Inc.'s 3.95% senior notes due 2020 are unchanged in trading since tightening after initial issuance earlier in the month, a trader said.

The Markit CDX Series 20 North American Investment Grade index eased 1 bp to a spread of 80 bps.

Santander tightens

Santander's 3.45% notes due 2018 (Baa2/BBB/BBB) firmed to 167 bps bid, 165 bps offered in late afternoon trading, a source said.

The notes traded earlier in the session at 168 bps bid, 163 bps offered.

Boston-based Santander, the parent company of Sovereign Bank and a subsidiary of Spain's Banco Santander, SA, sold $500 million of the notes on Thursday at a spread of Treasuries plus 180 bps.

Broadridge flat

Broadridge Financial Solutions' 3.95% senior notes due 2020 (Baa1/BBB/BBB+) traded on Monday at 179 bps bid, 174 bps offered, a source said.

The company sold $400 million of the notes on Aug. 14 at a spread of Treasuries plus 185 bps.

Broadridge Financial is a Success, N.Y.-based provider of investor communication services, securities processing and operations infrastructure to the financial services industry and corporations.

Bank CDS costs mixed

Investment-grade bank and brokerage CDS costs ended unchanged to higher on Monday, a market source said.

Bank of America Corp.'s CDS costs eased 1 bp to 107 bps bid, 112 bps offered. Citigroup Inc.'s CDS costs rose 1 bp to 100 bps bid, 105 bps offered. JPMorgan Chase & Co.'s CDS costs eased 1 bp to 86 bps bid, 90 bps offered. Wells Fargo & Co.'s CDS costs closed flat at 62 bps bid, 66 bps offered.

Merrill Lynch's CDS costs ended unchanged at 102 bps bid, 109 bps offered. Morgan Stanley's CDS costs went out flat at 139 bps bid, 144 bps offered. Goldman Sachs Group, Inc.'s CDS costs eased 1 bp to 130 bps bid, 135 bps offered.

Paul Deckelman contributed to this review

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