Toronto-Dominion Bank, Stryker bring new deals; TD Bank notes firm; Apple paper active

By Cristal Cody and Aleesia Forni

Virginia Beach, April 28 - Activity in the high-grade bond market was subdued on Monday, though the session did see two new deals price from Toronto-Dominion Bank and Stryker Corp.

Toronto-Dominion Bank came to market with $2.25 billion of senior notes in three-year fixed- and floating-rate tranches due 2017, a market source said.

The bank priced $1 billion of floating-rate notes due May 2, 2017 at par to yield Libor plus 24 basis points and $1.25 billion of 1.125% notes due May 2, 2017 to yield Treasuries plus 35 bps.

The notes sold at the tight end of talk, which was set in the area of Treasuries plus 37.5 bps.

Also during the session on Monday, Stryker brought to market a $1 billion issue of senior notes, which sold in 10- and 30-year tranches, an informed source said.

The deal included a $600 million tranche of 3.375% 10-year notes, which sold at Treasuries plus 80 bps.

A second tranche was $400 million of 4.375% 30-year bonds priced to yield Treasuries plus 95 bps.

Both tranches sold in line with talk, and the deal's orderbook was more than two times oversubscribed.

One market source said that the day's session was "fairly solid," and continues to expect around $15 billion to $20 billion of issuance for the week.

TD Bank's 1.125% notes due 2017 tightened 2 bps in the secondary market, a trader said.

Stryker's 3.375% notes due 2024 were not seen initially in the aftermarket, but the tranche of 4.375% bonds due 2044 traded wrapped around issuance, a trader said.

Apple Inc.'s bonds were active after the company announced a $30 billion share buyback program between now and the end of 2015, and market sources widely expect the company to issue bonds this year.

The company issued bonds (Aa1/AA+/) in 2013 soon after it announced a stock buyback.

TD Bank three-year notes

Toronto-Dominion Bank priced $2.25 billion of senior medium-term notes (Aa1/AA-/), series A, in fixed- and floating-rate tranches due 2017, according to a market source.

A $1 billion tranche of floating-rate notes due May 2, 2017 sold at par to yield Libor plus 24 bps.

Toronto-Dominion Bank also sold $1.25 billion of 1.125% notes due May 2, 2017 at 99.674 to yield 1.236%, or Treasuries plus 35 bps.

The notes sold at the tight end of talk, which was set in the Treasuries plus 37.5 bps area.

TD Bank's 1.125% notes due 2017 traded better in the secondary market at 33 bps bid, 31 bps offered, a trader said.

TD Securities, Barclays, J.P. Morgan Securities LLC and Wells Fargo Securities LLC were the joint bookrunners.

Proceeds will be added to the company's general funds and used for general corporate purposes.

The financial services and banking company is based in Toronto.

Stryker new issue

Stryker priced a $1 billion issue of notes (A3/A+/) in tranches due 2024 and 2044 on Monday, according to an informed source.

The sale included $600 million of 3.375% 10-year notes priced at 99.124 to yield 3.402%, or Treasuries plus 80 bps.

A $400 million tranche of 4.375% 30-year bonds sold at 99.551 to yield 4.402%, or Treasuries plus 95 bps.

Both tranche sold in line with talk.

Stryker's 4.375% bonds due 2044 traded flat at 95 bps bid, 92 bps offered, a trader said.

Barclays, Wells Fargo Securities and Goldman Sachs & Co. were the bookrunners.

Proceeds will be used for refinancing of debt, including existing commercial paper and the company's 3% notes due January 15, 2015.

Proceeds will also be used for working capital and other general corporate purposes, including acquisitions, stock repurchases and other business opportunities.

Stryker, a medical technology company based in Kalamazoo, Mich., was last in the market with a $1 million sale of notes in two tranches on March 20, 2013. The sale included $600 million of 1.3% five-year notes priced at Treasuries plus 60 bps and $400 million of 4.1% 30-year bonds priced at 100 bps over Treasuries.

Apple trades

In the secondary market on Monday, Apple's 2.4% notes due 2023 traded at 64 bps bid, 61 bps offered, a trader said.

The company sold $5.5 billion of the notes on April 30, 2013 at Treasuries plus 75 bps.

Apple's 3.85% notes due 2043 headed out at 104 bps bid, 101 bps offered. Apple sold $3 billion of the bonds in the April 30, 2013 offering at a spread of Treasuries plus 100 bps.

The computer and mobile communications device company is based in Cupertino, Calif.

Bank/brokerage CDS mixed

Investment-grade bank and brokerage CDS prices were mixed, according to a market source.

Bank of America Corp.'s CDS costs eased 2 bps to 66 bps bid, 69 bps offered. Citigroup Inc.'s CDS costs firmed 1 bp to 70 bps bid, 73 bps offered. JPMorgan Chase & Co.'s CDS costs declined 2 bps to 54 bps bid, 57 bps offered. Wells Fargo & Co.'s CDS costs were flat at 36 bps bid, 39 bps offered.

Merrill Lynch's CDS costs eased 2 bps to 71 bps bid, 75 bps offered. Morgan Stanley's CDS costs tightened 1 bp to 72 bps bid, 77 bps offered. Goldman Sachs Group, Inc.'s CDS costs firmed 1 bp to 85 bps bid, 88 bps offered.

Paul Deckelman contributed to this review.

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