SunTrust sells $1 billion; Xcel, Northrop, Pacific Gas price; FHLB markets; Duke firms

By Cristal Cody

Eureka Springs, Ark., Nov. 28 – High-grade issuers priced more than $3 billion of bonds on Monday in the first full session following the Thanksgiving Day holiday.

SunTrust Banks, Inc. priced $1 billion of 2.7% five-year senior notes at 99.872 to yield 2.726% and a spread of 93 basis points over Treasuries.

SunTrust Robinson Humphrey Inc., Barclays, Citigroup Global Markets Inc. and Morgan Stanley & Co. LLC were the bookrunners.

The Atlanta-based financial holding company for SunTrust Bank will use the proceeds and cash on hand to redeem $750 million of its outstanding 3.5% senior notes due 2017 and for general corporate purposes.

Xcel Energy Inc. tapped the primary market with an $800 million two-part offering of senior notes.

Northrop Grumman Corp. priced $750 million of long 10-year senior notes.

Pacific Gas & Electric Co. raised $650 million in two tranches of senior notes.

Coming up, the Federal Home Loan Bank System expects to price five-year Global Notes on Tuesday.

About $20 billion to $25 billion of volume is forecast for the week, according to market sources.

The Markit CDX North American Investment Grade index closed mostly unchanged at a spread of 74 bps.

In the secondary market, energy bonds were mixed on Monday.

Duke Energy Corp.’s 2.65% senior notes due 2026 traded about 1 bp tighter on the day.

Entergy Corp.’s 2.95% senior notes due 2026 softened about 1 bp.

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