BNP sells perpetual notes; Svenska enters primary; Comcast, MUFG ease; Goldman Sachs firms

By Aleesia Forni and Cristal Cody

New York, March 23 – BNP Paribas and Svenska Handelsbanken AB sold bonds on Wednesday, two deals that are expected to be among the last to hit this week’s primary.

BNP sold its additional tier 1 perpetual notes at the tightest side of price thoughts.

And Svenska Handelsbanken priced $1.75 billion of notes in fixed- and floating-rate pieces due 2021.

So far this week, around $12.35 billion of new issuance has entered the investment-grade market, and sources are predicting the remainder of the week to be mostly quiet ahead of the holiday weekend.

Meantime, Standard & Poor’s expects most higher-rated companies to “continue to have a favorable lending environment as investors pursue moderate yields while remaining more risk-averse” in the near term, analysts said in a report on Wednesday.

Analysts also noted that with plunging equities in China, tumbling commodity prices and higher volatility, risk aversion is on the rise.

Investment-grade bonds were mixed in secondary trading over the day and credit spreads leaked wider.

Comcast Corp.’s reopened 3.15% senior notes due 2026 traded 1 basis point softer on Wednesday.

Goldman Sachs Group Inc.’s 3.75% senior notes due 2026 firmed 2 bps.

Mitsubishi UFJ Financial Group, Inc.’s 3.85% senior notes due 2026 eased 4 bps.

Citigroup Inc.’s 2.7% senior notes due 2021 traded 5 bps better earlier in the session.

The Markit CDX North American Investment Grade index closed 1 bp softer at a spread of 81 bps.

BNP tier 1 notes

BNP Paribas priced $1.5 billion of 7.625% additional tier 1 perpetual notes (Ba1/BBB-/BBB-) on Wednesday at par, according to an informed source.

The notes will be non-callable for five years.

Pricing was at the tight end of price talk that was set in the 7.75% area.

BNP Paribas Securities Corp. was the bookrunner.

The financial services company is based in Paris.

Svenska five-years

In another financial new issue, Svenska Handelsbanken sold $1.75 billion of notes (Aa2/AA-/AA-) due March 31, 2021 in two tranches on Wednesday, a market source said.

Priced was $1.5 billion of 2.45% five-year notes at par to yield Treasuries plus 110 bps, sold inside price talk set in the area of Treasuries plus 125 bps, and $250 million of five-year floating-rate notes at par to yield Libor plus 115 bps. Talk was at the Libor equivalent to the fixed-rate portion.

BofA Merrill Lynch, Deutsche Bank Securities Inc., Goldman Sachs & Co., J.P. Morgan Securities LLC and Morgan Stanley & Co. LLC were the bookrunners.

The financial services company and bank is based in Stockholm.

Comcast eases

Comcast’s reopened 3.15% notes due 2026 eased 1 bp on Wednesday to 89 bps bid, a market source said.

The company sold a $350 million add-on to the issue on Tuesday at Treasuries plus 90 bps.

The bonds (A3/A/A-) originally priced in a $1.5 billion tranche on Feb. 16 at Treasuries plus 140 bps.

Comcast is a Philadelphia-based provider of entertainment, information and communication products and services.

Goldman stronger

Goldman Sachs’ 3.75% notes due 2026 firmed 2 bps to 167 bps bid, a source said.

The company sold $1.75 billion of the notes (A3/BBB+/A) on Feb. 22 at a spread of Treasuries plus 203 bps.

The financial services company is based in New York City.

MUFG softens

MUFG’s 3.85% notes due 2026 eased 4 bps over the day to 162 bps bid, according to a market source.

The company sold $2.5 billion of the notes (A1/A) on Feb. 23 at a spread of Treasuries plus 215 bps.

The financial services company is based in Tokyo.

Citigroup better

Citigroup’s 2.7% notes due 2021 traded earlier on Wednesday at 128 bps offered, a market source said.

The company sold $1.5 billion of the notes (Baa1/ BBB+/A) on Tuesday at a spread of Treasuries plus 133 bps.

Citigroup is a banking and financial services company based in New York.

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