ANZ New Zealand, Goldman Sachs BDC, Verizon, EBRD tap high-grade primary; inflows increase

By Cristal Cody

Tupelo, Miss., Feb. 6 – Deal volume slowed on Thursday with a handful of high-grade issuers in the primary market over the session.

ANZ New Zealand International Ltd. priced a $1.5 billion two-part offering of senior notes.

Goldman Sachs BDC, Inc. brought an upsized $360 million of five-year senior notes.

The deal follows Goldman Sachs Group Inc.’s $2 billion offering of 10-year senior notes priced on Wednesday.

Also on Thursday, Verizon Communications Inc. sold $2,385,000,000 of 40-year registered notes that it plans to list on the Taipei Exchange.

Sovereign, supranational and agency supply continued over the session with a deal from the European Bank for Reconstruction and Development.

EBRD priced an upsized $925 million of five-year sustainability bonds.

The Province of Quebec returned to the U.S. registered market during the session to sell C$500 million of seven-year global green notes following its $2.5 billion dollar offering of five-year notes on Tuesday.

Allied Properties Real Estate Investment Trust also tapped the Canadian high-grade primary market on Thursday with C$400 million of 10-year senior debentures.

More than $21 billion of dollar-denominated corporate bonds have priced week to date, while SSA supply totals about $11.2 billion.

Elsewhere, corporate investment-grade fund inflows rose slightly for the past week ended Wednesday, according to Lipper US Fund Flows on Thursday.

Inflows increased to $4.9 billion from $4.38 billion in the prior week and $4.19 billion in the previous week.

Net inflow year to date is more than $28 billion.

Credit spreads softened about a 0.5 basis point on Thursday after improving more than 4 bps in the previous two sessions.

The Markit CDX North American Investment Grade 33 index closed at a spread of 45.34 bps.

In the secondary market, bank and financial paper was mixed with new issues priced this week about 2 bps to 4 bps better, sources said.

Goldman Sachs Group’s $2 billion of 2.6% senior notes due Feb. 7, 2030 (A3/BBB+/A) firmed about 3 bps.

The notes priced on Wednesday at a spread of Treasuries plus 95 bps, tighter than initial price talk in the Treasuries plus 115 bps area.

Morgan Stanley’s new 2.699% fixed-to-floating-rate notes due Jan. 22, 2031 eased about 3 bps during the session.

ANZ brings $1.5 billion

ANZ New Zealand International priced a $1.5 billion two-part offering of senior notes (A1/AA-/AA-) on Thursday, according to a market source.

A $750 million tranche of 1.9% notes due Feb. 13, 2023 priced at a spread of Treasuries plus 48 bps.

Initial price talk was in the Treasuries plus 60 bps area, revised from the 65 bps area.

ANZ New Zealand priced $750 million of 2.55% notes due Feb. 13, 2030 with a Treasuries plus 93 bps spread. The notes were talked to price in the Treasuries plus 110 bps area, 5 bps tighter than initial guidance.

ANZ Securities Inc., BofA Securities, Inc., Citigroup Global Markets Inc. and RBC Capital Markets, LLC were the lead managers.

ANZ New Zealand is an Auckland, New Zealand-based funding arm of ANZ Bank New Zealand Ltd.

Goldman Sachs BDC prices

Goldman Sachs BDC priced $360 million of 3.75% five-year senior notes (Baa3//BBB-) on Thursday at a spread of 230 bps over Treasuries, according to a market source and a news release.

Initial price talk was in the Treasuries plus 240 bps area.

The offering was upsized from $300 million.

Bookrunners were BofA Securities, Citigroup, Goldman Sachs & Co. LLC, HSBC Securities (USA) Inc., ICBC Standard Bank Plc, MUFG, R. Seelaus & Co., LLC, SMBC Nikko Securities America, Inc. and SunTrust Robinson Humphrey, Inc.

New York-based Goldman Sachs BDC was formed by Goldman Sachs Group Inc. as a specialty finance business development company that invests in middle-market companies.

Verizon raises $2.3 billion

Verizon Communications (Baa1/BBB+/A-) priced $2,385,000,000 of notes due Feb. 24, 2060 on Thursday at par to yield 3.6%, according to an FWP filing with the Securities and Exchange Commission.

Deutsche Bank AG, Taipei Branch, Morgan Stanley Taiwan Ltd. and BNP Paribas Securities Corp., Taipei Branch were the bookrunners.

The company has applied to list the dollar notes on the Taipei Exchange.

Verizon is a New York City-based telecommunications company.

EBRD upsizes

The European Bank for Reconstruction and Development (Aaa/AAA/AAA) priced an upsized $925 million of 1.5% five-year sustainability bonds on Thursday at mid-swaps plus 7 bps, or a spread of 7.65 bps over Treasuries, according to a market source.

The bonds due Feb. 13, 2025 were initially talked to price in the mid-swaps plus 8 bps area with guidance tightened to mid-swaps plus 7 bps area.

The deal was upsized from $500 million.

BofA Securities, Credit Agricole Corporate and Investment Bank and Morgan Stanley & Co. LLC were the bookrunners.

The financial institution is based in London.

Morgan Stanley firms

In the secondary market, Morgan Stanley’s 2.699% fixed-to-floating-rate notes due Jan. 22, 2031 eased about 3 bps to 93 bps bid on Thursday, a source said.

The issue is tighter than where it was seen Monday trading 4 bps better at 97 bps bid.

Morgan Stanley (A3/BBB+/A) sold $3.5 billion of the notes on Jan. 16 at par to yield a spread of Treasuries plus 90 bps.

The notes convert Jan. 22, 2030 to a floating rate of SOFR plus 114.3 bps to but excluding the final maturity date.

Morgan Stanley is a New York-based financial products and services company.

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