GE bringing preferreds; primary volume light after holiday; bank paper trades mostly wider

By Aleesia Forni and Andrea Heisinger

New York, Jan. 22 - Issuers mostly stood on the sidelines to start the short week on Tuesday as a couple of Yankee names stepped up.

General Electric Capital Corp. was in the market with a sale of 30-year bonds and a $250 million offering of 40-year $25-par senior notes.

There was also an add-on priced by Norway's Kommunalbanken AS. The issuer priced $200 million of additional floating-rate notes due Jan. 26, 2015.

The four-day week following the Martin Luther King Jr. Day holiday was off to a slow start with "just a couple of Yankee issuers and a euro[-denominated] deal from Citi" being priced, a source said in the morning.

"It's not too exciting out there. I was expecting more today."

Some investment grade names from emerging markets were pricing bonds, which, along with the preferred stock trade from GE Capital, made up the day's volume.

There is $10 billion to $15 billion total expected to price throughout the week, with Wednesday and Thursday the most viable days, a source said late Tuesday after the close.

The source added that the day was quiet because syndicate desks and potential issuers were "coming off a holiday weekend, getting back into it, putting feelers out."

There are trades expected for Wednesday, although whether there will be anything of the $6 billion variety, like those from Goldman Sachs Group Inc. and JPMorgan Chase & Co. the previous week, remains to be seen.

Both bank's recent deals were mostly wider in the secondary market on Tuesday, sources told Prospect News.

One trader quoted Goldman Sachs's 3.625% notes due 2023 1 basis point weaker from levels seen earlier in the session.

In other bank paper, JPMorgan's $1.25 billion tranche of 1.8% five-year notes traded 3 bps weaker, while the bank's 3.2% notes due 2023 were trading flat.

GE preps $25-pars

GE Capital is planning a sale of at least $250 million of $25-par 40-year senior notes, according to a market source.

Price talk at midday was in the 4.875% area, the source said.

A trader pegged the notes at $24.60 bid, $24.62 offered in the gray market as of midday.

Morgan Stanley & Co. Inc., Bank of America Merrill Lynch, UBS Securities LLC and Wells Faro Securities LLC are the joint bookrunners.

GE Capital is the financing arm of Norwalk, Conn.-based General Electric.

GE's long bonds

General Electric Capital priced $700 million of 4.625% 30-year bonds at par to yield 4.625%, a market source said.

The bonds (A1/AA+/) were sold via syndicates HSBC Securities (USA) Inc. and UBS Securities LLC.

The funding arm of General Electric Co. is based in Norwalk, Conn.

KBN adds to floaters

Norway's Kommunalbanken was in the market with a $200 million addition to its floating-rate notes due Jan. 26, 2015, a market source said.

The notes (Aaa/AAA/) have a coupon of Libor plus 2 bps and were sold at 100.002 to yield Libor plus 2 bps.

Total issuance is $800 million, the source said.

Bookrunners were Bank of America Merrill Lynch, BNP Paribas Securities Corp. and J.P. Morgan Securities LLC.

The bank provides low-cost funding to municipalities and is based in Oslo.

Goldman notes weaken

The secondary market saw Goldman Sachs' 3.625% 10-year notes widen 1 bp to 184 bps bid, 179 bps offered on Tuesday.

The notes priced at 185 bps over Treasuries on Jan. 16.

Goldman Sachs is a New York City-based financial services company.

JPMorgan wider

Another trader quoted JPMorgan's $1.25 billion tranche of 1.8% five-year notes 3 bps weaker at 108 bps bid, 106 bps offered.

The notes were sold at a spread of 103 bps over Treasuries on Thursday before widening to 105 bps bid on Friday.

JPMorgan's $2.75 billion of 3.2% notes due 2023 were trading flat at 137 bps bid, 134 bps offered.

The New York City-based financial services company priced the notes at Treasuries plus 133 bps.

Stephanie N. Rotondo contributed to this review

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.