By Cristal Cody
Chicago, Jan. 4 – Santander Holdings USA, Inc. detailed its sale of $1 billion of six-year fixed-to-floating rate senior notes (Baa3/BBB+/BBB+) from Monday in an FWP filed with the Securities and Exchange Commission.
The notes start with a 2.49% coupon and priced with a spread of Treasuries plus 112.5 basis points.
Price talk had been in the Treasuries plus 140 bps area, a market source said.
The coupon converts to a floating rate starting Jan. 6, 2027 at SOFR plus 124.9 bps, calculated quarterly.
The notes are completely non-callable until July 5, 2022. There is a make-whole call option from July 5, 2022 to Jan. 6, 2027 at Treasuries plus 20 bps. All of the bonds can be redeemed at par starting Jan. 6, 2027 and then any amount of the issue can be redeemed at par one month before the maturity date.
Santander Investment Securities Inc., Barclays, BNP Paribas Securities Corp. and Citigroup Global Markets Inc. are the bookrunners.
The company plans to use the proceeds for general corporate purposes or to repay debt.
Boston-based Santander Holdings USA is a wholly owned subsidiary of Madrid-based Banco Santander, SA.
| Issuer: | Santander Holdings USA, Inc.
|
| Amount: | $1 billion
|
| Issue: | Fixed-to-floating rate senior notes
|
| Maturity: | Jan. 6, 2028
|
| Bookrunners: | Santander Investment Securities Inc., Barclays, BNP Paribas Securities Corp. and Citigroup Global Markets Inc.
|
| Co-managers: | BMO Capital Markets Corp., Deutsche Bank Securities Inc. and RBC Capital Markets, LLC
|
| Coupon: | 2.49% starting rate; resets to SOFR plus 124.9 bps
|
| Price: | Par
|
| Yield: | 2.49%
|
| Spread: | Treasuries plus 112.5 bps
|
| Call features: | No call until July 5, 2022; make-whole call at Treasuries plus 20 bps from July 5, 2022 to Jan. 6, 2027; at par if all bonds are redeemed starting Jan. 6, 2027; in whole or in part at par starting Dec. 6, 2027
|
| Trade date: | Jan. 3
|
| Settlement date: | Jan. 6
|
| Ratings: | Moody’s: Baa3
|
| S&P: BBB+
|
| Fitch: BBB+
|
| Price talk: | Treasuries plus 140 bps area
|
| Cusip: | 80282KBC9
|
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