Morning Commentary: Crown Castle, Scotiabank, BankUnited, Hormel, MassMutual on tap

By Cristal Cody

Tupelo, Miss., June 4 – A handful of corporate issuers expects to tap the high-grade primary market on Thursday, while the sovereign, supranational and agency space quieted over the morning, sources said.

Crown Castle International Corp. is offering three tranches of senior notes (Baa3/BBB-/BBB) in a registered deal that includes five-year notes and two tranches of notes due Jan. 15, 2031 and Jan. 15, 2051.

The five-year notes are talked to price with a spread in the Treasuries plus 135 basis points area, while the 2031 notes are talked at the 180 bps spread area and the 2051 notes are guided to price at the 200 bps spread area.

Financial supply also is expected during the session.

Bank of Nova Scotia is offering five-year senior bail-inable notes (A2/A-/AA-) with initial price talk in the Treasuries plus 110 bps area.

BankUnited, Inc. intends to tap the primary market with a $300 million offering of 10-year subordinated notes (Baa3//BBB-) that is talked at the 5.25% area.

Meanwhile, Hormel Foods Corp. (A1/A) plans to bring an offering of 10-year notes to the market on Thursday. The issue is initially talked to price at the Treasuries plus 135 bps area.

In other issuance expected over the day, Reinsurance Group of America, Inc. is offering $500 million of 10-year senior notes (Baa1/BBB) with initial price guidance in the 300 bps over Treasuries area.

MassMutual Global Funding II is on deck with new three-year funding agreement-backed notes (Aa3/AA+/AA+) talked to price in the Treasuries plus 80 bps area.

Also on Thursday, Athene Holding Ltd. intends to price $200 million of fixed-rate reset perpetual non-cumulative preference shares (BBB+/BBB). The preferreds are talked to price at the 6.5% to 6.625% area.

Deal volume already totals more than $39 billion week to date, compared to the $30 billion to as much as $50 billion of supply expected by market participants for the week.

In other activity, daily inflows to U.S. investment-grade bond funds and ETFs totaled $11.65 billion over the past four business days from May 28 through Tuesday, according to a BofA Securities, Inc. research note released on Thursday.

The total surpasses the previous weekly record of $10.11 billion seen in October 2014.

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