Banco Santander, HCP, Spirit Realty, Athene Global price; credit spreads tighten; inflows dip

By Cristal Cody

Tupelo, Miss., June 20 – Banco Santander, SA priced $2.5 billion of senior preferred debt securities in two tranches on the tight side of guidance Thursday.

HCP, Inc. tapped the primary market during the session with $1.3 billion of fixed-rate notes in two parts.

Spirit Realty Capital, Inc.’s operating partnership, Spirit Realty, LP, sold $400 million of 10-year registered senior notes.

In addition, Athene Global Funding priced $300 million of five-year senior secured notes.

In other issuance, Cadence Bancorp. sold $85 million of 10-year fixed-to-floating rate subordinated notes.

High-grade issuers have priced about $10 billion of bonds week to date, compared to about $15 billion to $20 billion of supply expected by market sources for the week.

Issuers were quiet on Wednesday with the Federal Reserve set to release its monetary policy decision. The Fed kept rates unchanged.

On Thursday, Lipper US Fund Flows reported inflows of $3.65 billion for the week ended Wednesday, down slightly from $4.02 billion of inflows in the previous week.

Credit spreads continued to tighten on Thursday and have firmed about 5 bps since the start of the week. The Markit CDX North American Investment Grade 32 index closed more than 1 bp tighter at a spread of 54 bps.

Banco Santander sells $2.5 billion

Leading the day’s high-grade deal volume, Banco Santander sold $2.5 billion of senior preferred debt securities (A2/A/A) in two tranches on Thursday, according to a market source.

The company priced $1.5 billion of 2.706% five-year notes at a Treasuries plus 95 bps spread. Price guidance was in the Treasuries plus 100 bps spread area.

Banco Santander sold $1 billion of 3.306% 10-year notes at a spread of 130 bps over Treasuries. The notes were guided to print at a spread in the 135 bps over Treasuries area.

BofA Securities, Inc., Citigroup Global Markets Inc., J.P. Morgan Securities LLC, Morgan Stanley & Co. LLC and Santander Investment Securities Inc. were the bookrunners.

The banking services company is based in Madrid.

HCP prices $1.3 billion

HCP priced $1.3 billion of fixed-rate notes (Baa1/BBB+/BBB) in two tranches on Thursday, according to an FWP filed with the Securities and Exchange Commission.

The company sold $650 million of 3.25% seven-year notes at a spread of of 140 bps over Treasuries. The notes priced at 99.906 to yield 3.265%.

A $650 million tranche of 3.5% 10-year notes priced at 99.572 to yield 3.551%, or a Treasuries plus 155 bps spread.

Mizuho Securities USA Inc., Credit Suisse Securities (USA) LLC, J.P. Morgan Securities, Wells Fargo Securities LLC, Barclays, Morgan Stanley and Scotia Capital (USA) Inc. were the bookrunners.

Irvine, Calif.-based HCP is a real estate investment trust that invests primarily in real estate serving the health care industry.

Spirit Realty raises $400 million

Spirit Realty sold $400 million of 4% 10-year registered senior notes (Baa3/BBB/BBB-) at a spread of 200 bps over Treasuries, according to a company press release and an FWP filing with the SEC.

The notes priced at 99.924 to yield 4.009%.

Wells Fargo Securities, J.P. Morgan Securities, Morgan Stanley, RBC Capital Markets, LLC, Regions Securities LLC and SunTrust Robinson Humphrey, Inc. were the bookrunners.

The notes are guaranteed by Spirit Realty Capital.

Spirit Realty Capital is a Dallas-based net-lease real estate investment trust.

Athene Global Funding prints

Athene Global Funding placed $300 million of 2.75% five-year senior secured notes (/A/A) on Thursday at a spread of 107 bps over Treasuries, a market source said.

The notes priced on the tight side of guidance in the Treasures plus 110 bps area.

Barclays, Credit Suisse Securities (USA) LLC and Deutsche Bank Securities Inc. were the bookrunners.

Athene Global Funding is a trust established to price debt secured by funding agreements issued by Athene Annuity & Life Insurance Co. and Athene Annuity and Life Co. The companies are subsidiaries of Pembroke, Bermuda-based Athene Holding Ltd.

Cadence Bancorp. prices

In other issuance, Cadence Bancorp. sold $85 million of 10-year fixed-to-floating rate subordinated notes (/BB/Kroll: BBB-/Egan-Jones: A-) at par to yield 4.75%, according to an FWP filing with the SEC.

The notes will reset June 30, 2024 to a floating rate of Libor plus 303 bps.

Sandler O’Neill + Partners, LP and U.S. Bancorp Investments Inc. were the bookrunners.

The bank holding company is based in Houston.

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