Dominion Resources, Huntington, Caterpillar, Paccar, World Bank price; credit spreads firm

By Cristal Cody

Eureka Springs, Ark., Aug. 4 – New high-grade bond deals came to the primary market on Thursday from issuers including Dominion Resources, Inc., Huntington Bancshares Inc., Caterpillar Financial Services Corp. and Paccar Financial Corp.

International Bank for Reconstruction and Development (World Bank) (Aaa/AAA) also priced the bank’s second U.S. dollar global bond deal of the year, a $1.5 billion offering of 1.125% four-year global bonds placed at a spread of 35.3 basis points over Treasuries.

The order book closed in excess of $1.9 billion with more than 45 accounts participating.

“The high-quality order book is a clear signal to the faith placed by investors in IBRD’s credit quality and status despite coming in a less-traditional maturity and at the height of the summer,” Adrien de Naurois, managing director of SSA syndicate at bookrunner BofA Merrill Lynch, said in the release.

The Markit CDX North American Investment Grade index ended the session 2 bps tighter at a spread of 73 bps.

Google holding company Alphabet Inc.’s 1.998% notes due 2026 that priced on Tuesday traded 2 bps tighter earlier in the secondary market.

Microsoft Corp.’s senior notes (Aaa/AAA) that priced on Monday traded about 1 bp to 5 bps better early Thursday.

World Bank sells $1.5 billion

World Bank (Aaa/AAA) announced on Thursday that it priced $1.5 billion of 1.125% four-year global bonds with a spread of 35.3 bps over Treasuries.

The bonds priced at 99.93 to yield 1.143%.

Barclays, BofA Merrill Lynch and BMO Capital Markets Corp. were the lead managers.

Investors in the Americas took 40% of the bonds, while 33% went to Asia Pacific investors, 20% were purchased by European investors and 7% went to investors in the Middle East and Africa.

Central banks and official institutions purchased 54% of the bonds. Bank treasuries, banks and corporate investors bought 26% of the deal and asset managers, pension and insurance investors purchased 20%.

The deal is World Bank’s second U.S. dollar global bond transaction and second U.S. dollar global bond with a four-year maturity in 2016. World Bank said it is the only sovereign, supranational or agency borrower to have issued a four-year U.S. dollar global bond in 2016.

The global development financing cooperative is based in Washington, D.C.

Dominion sells three parts

Dominion Resources priced a $1.3 billion three-part offering of senior notes (Baa2/BBB/BBB+) on Thursday, according to an FWP filing with the Securities and Exchange Commission.

The company sold $500 million of 1.6% three-year series B notes at 99.991 to yield 1.603%. The notes priced with a spread of 85 bps over Treasuries.

Dominion Resources priced $400 million of 2% five-year series C notes at 99.857 to yield 2.03%, or 100 bps over Treasuries.

The $400 million tranche of 2.85% 10-year series D notes were sold at 99.965 to yield 2.854%, or 135 bps over Treasuries.

Mizuho Securities USA Inc., RBC Capital Markets, LLC, BNP Paribas Securities Corp., Deutsche Bank Securities Inc., MUFG, Scotia Capital (USA) Inc., SunTrust Robinson Humphrey Inc. and U.S. Bancorp Investments, Inc. were the bookrunners.

Proceeds will be used for general corporate purposes, including to partly fund the company’s merger with Questar.

Dominion Resources is a Richmond, Va.-based energy producer and transporter.

Huntington Bancshares prices

Huntington Bancshares priced $1 billion of 2.3% senior notes due Jan. 14, 2022 with a spread of 130 bps over Treasuries on Thursday, according to an FWP filing with the SEC.

The notes priced at 99.849 to yield 2.33%.

Goldman Sachs & Co., Credit Suisse Securities (USA) LLC, Deutsche Bank Securities Inc. and Huntington Investment Co. were the bookrunners.

Proceeds will be used for general corporate purposes, which may include funding asset growth of subsidiaries.

Huntington Bancshares is a Columbus, Ohio-based regional bank holding company.

Caterpillar taps market

Caterpillar Financial Services sold $1.25 billion of series H medium-term notes in two parts on Thursday, according to FWP filings with the SEC.

The company priced $950 million of 1.7% five-year MTNs at 99.795 to yield 1.743%. The notes priced with a spread of 72 bps over Treasuries.

Caterpillar Financial sold $300 million of 2.4% 10-year notes at 99.991 to yield 2.401%, or 90 bps over Treasuries.

Citigroup Global Markets Inc., BofA Merrill Lynch and Societe Generale were the lead managers.

Nashville, Tenn.-based Caterpillar Financial Services is a financing arm of Caterpillar Inc.

Paccar brings two tranches

Paccar Financial sold $500 million of series O MTNs in two parts on Thursday, according to FWP filings with the SEC.

In the first tranche, the company sold $250 million of 1.2% three-year notes at par to yield 45 bps over Treasuries.

Paccar Financial priced $250 million 1.65% five-year notes at 99.866 to yield 1.678%, or 65 bps over Treasuries.

MUFG, Citigroup, RBC Capital markets, LLC, Wells Fargo Securities, LLC, BNP Paribas Securities Corp. and J.P. Morgan Securities LLC were the lead managers.

Paccar Financial is a financing arm of Bellevue, Wash.-based Paccar Inc.

Alphabet firms

Alphabet’s 1.998% notes due 2026 traded 2 bps better than issuance at 66 bps offered in the secondary market early on Thursday, a source said.

Alphabet priced $2 billion of the notes (Aa2/AA) on Tuesday at a spread of 68 bps over Treasuries.

Mountain View, Calif.-based Alphabet is the holding company for Google and other subsidiaries.

Microsoft improves

Microsoft’s 2.4% notes due 2026 were quoted about 1 bp tighter at 86 bps offered in secondary trading earlier in the day, according to a market source.

The company sold $4 billion of the notes on Monday at a spread of 90 bps over Treasuries.

The computer software company is based in Redmond, Wash.

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