Deutsche, Plains, Abbey National, Fifth Third price; Home Depot, Wal-Mart firm ahead of earnings

By Aleesia Forni and Cristal Cody

Virginia Beach, Aug. 17 – The investment-grade bond market hosted Deutsche Bank AG, Plains All American Pipeline, LP, Abbey National Treasury Services plc and Fifth Third Bank on Monday, kicking off the week with $6.2 billion of new issuance.

Financial issuers Deutsche Bank, Fifth Third and Santander’s Abbey National were each in the primary with new issues priced at the tight end of guidance.

Also on Monday, Plains All American sold $1 billion of five-year notes around 12.5 basis points tight of the mid-point of price talk, while Xerox Corp. was forced to price its new $400 million five-year offering around 25 bps wide of initial guidance.

The session also saw new deals from International Finance Corp., Huntington National Bank and Ryder System Inc.

In secondary trading, Home Depot Inc.’s 4.25% senior notes due 2046 tightened 3 bps ahead of the company’s second quarter earnings report set for release before the market opens on Tuesday.

Wal-Mart Stores Inc.’s bonds (Aa2/AA/AA) traded flat to 3 bps tighter. The retailer also plans to release its second quarter earnings ahead of the market opening on Tuesday.

In other secondary action, AT&T Inc.’s 3.4% notes due 2025 headed out 5 bps better on the bid side.

Verizon Communications Inc.’s 3.5% notes due 2024 were mostly unchanged.

The Markit CDX North American Investment Grade index was flat on Monday at a spread of 77 bps.

Deutsche Bank two-parter

Deutsche Bank priced $1.25 billion of five-year notes (A3/BBB+/A) in fixed- and floating-rate tranches on Monday, according to an informed source.

There was $1 billion of fixed-rate notes due 2020 priced at Treasuries plus 143 bps.

The notes sold at the tight end of guidance set in the 145 bps area over Treasuries and were talked in the mid-150 basis points area over Treasuries.

A $250 million floater due 2020 sold at Libor plus 131 bps following talk set at the Libor equivalent to the five-year fixed-rate notes.

Deutsche Bank Securities Inc. is the bookrunner.

The bank is based in Frankfurt.

Fifth Third bank notes

Meantime, Fifth Third priced $1.25 billion of senior bank notes (A3/A-/A) in two parts, a market source said.

A $1 billion 2.15% three-year note priced at 99.983 to yield 2.156% or a spread of 110 bps over Treasuries.

Pricing was at the tight end of guidance set in the Treasuries plus 115 bps area following talk in the range of Treasuries plus 120 bps to 125 bps.

Also, $250 million of three-year floating-rate notes sold at par to yield Libor plus 91 bps.

Guidance was at the fixed-rate tranche’s Libor equivalent.

The bookrunners are Deutsche Bank Securities Inc., Goldman Sachs & Co., J.P. Morgan Securities LLC and Fifth Third.

Fifth Third is a Cincinnati-based financial services company.

Abbey National prices tight

Abbey National Treasury Services was also in Monday’s market selling a $1 billion offering of three-year notes (A2/A/A) in two tranches, according to an informed source.

Included in the offering was $750 million of 2% notes due 2018 sold at 99.708 to yield 2.101% or Treasuries plus 105 bps.

The notes were talked in the Treasuries plus 110 bps area.

Also, $250 million of floating-rate notes due 2018 priced at par to yield Libor plus 85 bps.

Guidance was at the Libor equivalent to the three-year fixed-rate notes.

BofA Merrill Lynch, Goldman Sachs & Co., Santander and Wells Fargo Securities LLC are the bookrunners.

The notes are guaranteed by Santander UK plc.

Proceeds from the sale will be used for general corporate purposes.

The financial services companies are based in London.

Plains’ new issue

In other primary happenings, Plains All American Pipeline and PAA Finance Corp. priced $1 billion of 4.65% senior notes (Baa2/BBB+) due Oct. 15, 2025 at Treasuries plus 250 bps, according to a market source and an FWP filing with the Securities and Exchange Commission.

Pricing was at 99.846 to yield 4.668%.

The notes sold at the tight end of guidance set in the Treasuries plus 255 bps area following initial talk in the area of 262.5 bps over Treasuries.

Proceeds will be used to repay outstanding borrowings under the company’s commercial paper program and for general partnership purposes.

Citigroup Global Markets Inc., Mizuho Securities, MUFG and UBS Securities LLC are the joint bookrunners.

The oil and natural gas transportation, production and storage company is based in Houston.

Huntington National offering

Huntington National Bank priced $500 million of 2.875% senior bank notes (A3/BBB+/A-) due 2020 on Monday at Treasuries plus 140 bps, an informed source said.

Proceeds will be used for general corporate purposes.

Bookrunners were Deutsche Bank Securities Inc., Goldman Sachs & Co. and Huntington.

The banking affiliate of Huntington Bancshares is based in Columbus, Ohio.

Xerox prices wide

The session also brought Xerox, which sold $400 million of 3.5% five-year senior notes at Treasuries plus 212.5 bps, according to a market source and an FWP filed with the Securities and Exchange Commission.

Pricing was at 99.113 to yield 3.696%.

The issue (Baa2/BBB/BBB) sold wide of initial price thoughts set in the 187.5 bps area over Treasuries.

BNP Paribas Securities Corp., Citigroup Global Markets Inc., Credit Suisse Securities (USA) LLC and UBS Securities LLC are the joint bookrunners.

Proceeds will be used for general corporate purposes, which may include repayment of debt.

The maker of office machines is based in Norwalk, Conn.

Ryder System five-years

Ryder System priced a $300 million offering of 2.875% five-year senior notes on Monday with a spread of 135 bps over Treasuries, according to a market source and a 424B3 filed with the Securities and Exchange Commission.

The notes (Baa1/BBB/A-) priced at 99.888 to yield 2.899%.

BNP Paribas Securities Corp., BofA Merrill Lynch, Mizuho Securities, Morgan Stanley & Co. LLC and RBC Capital Markets LLC are the joint bookrunners.

The transportation and logistics company is based in Miami.

IFC floaters

International Finance priced a $500 million offering of floating-rate five-year bonds (Aaa/AAA) on Monday at par to yield Libor plus 1 bp, a market source said.

BofA Merrill Lynch, Barclays and BMO were the banks on the deal.

The World Bank member and lender to the private sector in developing countries is based in Washington, D.C.

Home Depot firms

Home Depot’s 4.25% notes due 2046 firmed 3 bps to 131 bps bid on Monday, a market source said.

The company sold $1.25 billion of the bonds (A2/A/A) on May 28 at Treasuries plus 135 bps.

The home improvement retailer is based in Atlanta.

Wal-Mart flat to better

Wal-Mart’s 3.3% notes due 2024 firmed 3 bps to 88 bps bid in secondary trading over the session, a source said.

The company priced a $500 million add-on to the notes on Oct. 7 at Treasuries plus 68 bps.

Wal-Mart originally sold $1 billion of the notes at 73 bps plus Treasuries on April 15, 2014.

The company’s 4.3% bonds due 2044 were unchanged on the day at 130 bps bid.

Wal-Mart sold $1 billion of the bonds in the April 15, 2014 offering at Treasuries plus 90 bps.

The discount retailer is based in Bentonville, Ark.

AT&T tightens

AT&T’s 3.4% notes due 2025 headed out 5 bps better from Friday at 190 bps bid, a market source said.

The notes traded earlier in the day 2 bps tighter at 188 bps offered.

AT&T sold $5 billion of the notes (/BBB+/A-) on April 23 at a spread of Treasuries plus 150 bps.

The telecommunications company is based in Dallas.

Verizon stable

Verizon’s 3.5% notes due 2024 traded late afternoon unchanged at 169 bps bid, a market source said.

The notes were quoted earlier in the day about 1 bp tighter from Friday at 172 bps offered.

The company sold $2.5 billion of the notes (Baa1/BBB+/A-) on Oct. 22 at a spread of Treasuries plus 135 bps.

The telecommunications company is based in New York City.

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