GE issues $2.2 billion in floaters, Countrywide bonds struggle in quiet high-grade market

By Andrea Heisinger

Omaha, Aug. 16 - GE Capital Corp. had a new $2.2 billion issue that flew largely under the radar and Countrywide Financial Corp. floundered on a quiet Thursday in investment grade trading.

The GE issue of three-year global senior unsecured floating-rate notes (Aaa/AAA) priced at Libor plus 180 basis points.

Countrywide announced it was supplementing its funding liquidity position by tapping into an $11.5 billion credit facility.

In light of this, traders commented Countrywide's bonds were "not doing so well" and "all over the place" in trading.

Their bonds due in June 2012 were trading at Treasuries plus 525 bps, although that was improved from the 580s earlier in the session, a market source said.

Another market source said their 5.2% notes due 2008 were at a 20% yield earlier in the day.

New deals weren't happening Thursday, and wouldn't be Friday either, according to a market source.

"This is not the type of secondary market you wanted to bring new deals into when sub-prime is in the condition it is," the source said.

They blamed it on lack of a firm market tone, with investors scared of the market.

"It's going to take a couple days of stability before anything is brought into the market," the source said.

Earlier in the year, a big August was predicted, one trader said, adding "but the meltdown in the credit sector has taken care of that."

The source predicted next week may hold a one day window of opportunity where many new issues come on the market after a couple of days of stability.

This is similar to what happened last week when $15 billion in new deals came to the market in one day, setting a record for the year so far.

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