Rentenbank sets talk; primary quiet to begin new year; bank, financial paper mostly soft

By Aleesia Forni and Cristal Cody

Virginia Beach, Jan. 5 – The investment-grade bond market began the first full week of the new year on a quiet note.

The session saw Landwirtschaftliche Rentenbank announce plans to price an offering of bonds, while other potential issuers stayed on the sidelines on Monday amid a weaker backdrop.

“Softer tone today,” one market source said, adding that the primary market should see its first signs of life during the session on Tuesday.

Sources are calling for around $25 billion of supply to price during the first full week of the new month, which is expected to see more than $100 billion of new issuance.

Investment-grade bank and financial paper and credit spreads ended Monday’s session mostly weaker, according to market sources.

The Markit CDX North American Investment Grade series 23 index eased 2 basis points to a spread of 69 bps.

Goldman Sachs Group Inc.’s 3.85% notes due 2024 traded 5 bps softer in the secondary market, a source said.

Citigroup Inc.’s 3.75% notes due 2024 headed out 3 bps weaker.

Bank of America Corp.’s 4% notes due 2024 eased 2 bps from Friday, according to a market source.

JPMorgan Chase & Co.’s 3.625% senior notes due 2024 were flat.

Rentenbank sets talk

Germany’s Rentenbank set price talk on Monday for its planned offering of notes due 2025 in the area of mid-swaps plus 10 bps, according to an informed source and a 424B5 filed with the Securities and Exchange Commission.

Proceeds will be used to finance lending activities, including the refinancing of existing liabilities.

Barclays, Citigroup Global Markets Inc., Deutsche Bank Securities Inc. and TD Securities are managing the sale.

The German development agency for agribusiness is based in Frankfurt.

Goldman widens

Goldman Sachs’ 3.85% notes due 2024 (Baa1/A-/A) were quoted late Monday afternoon at 145 bps bid, 5 bps wider than on Friday, a market source said.

Goldman Sachs sold $2.25 billion of the notes on June 30, 2014 at Treasuries plus 135 bps.

The financial services company is based in New York City.

Citigroup softens

Citigroup’s 3.75% notes due 2024 (Baa2/A-/A) traded 3 bps wider at 137 bps bid, according to a market source.

Citigroup sold $1.25 billion of the 10-year notes on June 9, 2014 at Treasuries plus 115 bps.

The bank is based in New York City.

Bank of America eases

Bank of America’s 4% notes due 2024 (Baa2/A-/A) eased 2 bps in secondary trading to 132 bps bid, a market source said.

Bank of America sold $2.75 billion of the notes on March 27, 2014 at a spread of Treasuries plus 137 bps.

The financial services company is based in Charlotte, N.C.

JPMorgan unchanged

JPMorgan’s 3.625% senior notes due 2024 (A3/A/A+) were unchanged at 116 bps bid on Monday, a source said.

JPMorgan sold $2 billion of the notes on May 6, 2014 at a spread of Treasuries plus 110 bps.

The financial services company is based in New York City.

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