KfW preps three-year notes; primary quiet amid global sell-off; Charter, Walgreens firm

By Aleesia Forni and Cristal Cody

New York, Jan. 4 – Germany’s KfW announced plans to price an offering of three-year notes this week, giving the investment-grade primary bond market its only signs of activity to open the new year.

The bank is planning to price a benchmark offering of notes (Aaa/AAA/AAA) on Tuesday, announcing price talk in the mid-swaps plus 22 basis points area.

The bookrunners are Barclays, Morgan Stanley & Co. LLC and RBC Capital Markets LLC.

The German government-owned development bank is based in Frankfurt.

Meantime, a number of potential issuers stood down to open the calendar year on Monday as weak economic data out of China sparked fears of a global slowdown, sending stocks tumbling.

One market source noted that Tuesday could be an active session for primary markets depending on the market’s tone overnight.

Around $25 billion to $30 billion of new issuance is expected for the opening week of the calendar year.

Investment-grade bonds headed out mostly unchanged to slightly tighter in secondary trading on Monday.

Charter Communications Inc.’s bonds (Ba1/BBB-) traded flat to 2 basis points better over the day.

Walgreens Boots Alliance Inc.’s 3.8% senior notes due 2024 firmed 1 bp.

Bank of America Corp.’s 3.875% senior notes due 2025 tightened 2 bps.

The Markit CDX North American Investment Grade 25 index ended the day about 1 bp tighter at a spread of 90 bps.

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