Post-holiday high-grade supply light; Toyota, Athene price; Blackstone/GSO plan deal

By Cristal Cody

Tupelo, Miss., Oct. 13 – Investment-grade supply remained light on Tuesday following the long U.S. Columbus Day holiday.

Toyota Motor Credit Corp. priced $2.75 billion of medium-term notes (A1/A+/A+) in three tranches, including two-year floating- and fixed-rate tranches and a five-year fixed-rate note.

Also, Athene Global Funding priced an upsized $600 million Rule 144A and Regulation S offering of three-year funding agreement-backed senior secured notes (/A/A) on Tuesday.

The deal was upsized from $300 million.

In other market activity, Blackstone/GSO Secured Lending Fund kicked off a two-day session of fixed income investor calls for a Rule 144A and Regulation S offering of dollar-denominated senior notes (Baa3//BBB-) on Tuesday.

About $15 billion to $20 billion of new deal volume is expected this week with market participants eying the potential for more following the release of quarterly earnings reports from the major banks this week.

JPMorgan Chase & Co. and Citigroup Inc. released third quarterly earnings reports before the market opened on Tuesday.

Bank of America Corp., Goldman Sachs Group Inc. and Wells Fargo & Co. are scheduled to post profit results on Wednesday.

SSA issuers active

Meanwhile, the sovereign, supranational and agency primary market is expected to be active this week.

Caisse d'Amortissement de la Dette Sociale (Aa2//AA) is marketing a Rule 144A and Regulation S offering of dollar-denominated 10-year social bonds to price on Wednesday.

Initial price talk is in the mid-swaps plus 30 basis points area.

The Council of Europe Development Bank (Aa1/AAA/AA+) also plans to tap the primary market on Wednesday with dollar-denominated three-year senior notes talked at the mid-swaps plus 6 bps area.

In addition, the European Investment Bank (Aaa/AAA/AAA) is marketing dollar-denominated global sustainability awareness bonds that are expected to price on Wednesday.

Market tone was soft over the day.

The Markit CDX North American Investment Grade 35 index closed 1.5 bps wider from Friday at a spread of 54.97 bps.

The PIMCO Investment Grade Corporate Bond index ended 0.03% lower at 115.41, while the iShares iBoxx Investment Grade Corporate Bond ETF slipped 0.10% to 135.58.

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