Morning Commentary: KfW offers three-year notes; Deutsche Bank firms; credit spreads stable

By Cristal Cody

Eureka Springs, Ark., Oct. 12 – KfW (Aaa/AAA/AAA) is in Wednesday’s high-grade bond deal pipeline with an offering of three-year global dollar-denominated notes talked to price in the mid-swaps plus 15 basis points area.

BofA Merrill Lynch, Barclays and Citigroup Global Markets Inc. are the bookrunners.

In the secondary market, Deutsche Bank AG’s 4.25% notes due 2021 that priced on Friday and reopened on Tuesday tightened more than 15 bps.

The Markit CDX North American Investment Grade index was unchanged at the start of the day at a spread of 76 bps.

The three-month Libor yield was down 1 bp to 87 bps early Wednesday.

High-grade secondary trading volume totaled $15.4 billion on Tuesday, according to Trace.

Deutsche Bank tightens

Deutsche Bank’s 4.25% notes due 2021 traded at 273 bps offered in the secondary market, a source said.

Deutsche Bank priced $3 billion of the five-year notes on Friday at a spread of Treasuries plus 300 bps and reopened the issue on Tuesday to sell a $1.5 billion add-on at Treasuries plus 290 bps.

Deustche Bank is a banking and financial services company based in Frankfurt.

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