Bank of America, Concho, Citibank, Public Storage price notes; Quebec plans $500 million

By Cristal Cody

Tupelo, Miss., Sept. 13 – The high-grade bond market stayed busy for a third straight session on Wednesday with numerous issuers.

Bank of America Corp. came with a $4.5 billion three-tranche offering of senior notes.

Concho Resources Inc. priced $1.8 billion of split-rated senior notes in two parts.

Citibank, NA raised $2.25 billion in an offering of two-year fixed- and floating-rate notes.

Public Storage sold $1 billion of senior notes in two parts.

Washington Gas Light Co. tapped its 3.796% notes due Sept. 15, 2046 in a $200 million deal.

Also, the Commonwealth Bank of Australia was in the market offering five tranches of notes on Wednesday, a source said. Final pricing details were not available by press time.

In addition, Nordic Investment Bank priced $1 billion of three-year notes.

In other action on Wednesday, Bellevue, Wash.-based online travel company Expedia Inc. (Ba1/BBB-/BBB-) held investor calls for a possible deal, according to a market source.

BofA Merrill Lynch, Goldman Sachs & Co. and J.P. Morgan Securities LLC were the call arrangers.

Looking to Thursday’s supply, the Province of Quebec plans to price a $500 million dollar-denominated offering of floating-rate notes due Sept. 21, 2020. The notes were talked in the Libor plus 15 basis points area.

BofA Merrill Lynch, BMO Capital Markets Corp., CIBC World Markets Inc. and HSBC Securities (USA) Inc. are the bookrunners.

Also in the pipeline, Kommuninvest I Sverige AB is marketing a $1 billion offering of three-year notes in a Rule 144A and Regulation S deal, according to a market source.

Barclays, HSBC Securities, J.P. Morgan Securities and SEB Securities, Inc. are the lead managers.

The Markit CDX North American Investment Grade 28 index ended the day modestly tighter at a spread of 56 bps.

BofA prices $4.5 billion

Bank of America sold $4.5 billion of senior notes (Baa1/BBB+/A) in three tranches on Wednesday, according to a market source.

The bank placed $750 million of four-year floating-rate notes at Libor plus 65 bps.

Bank of America priced $2 billion of 2.328% fixed-to-floating-rate notes due Oct. 1, 2021 at a spread of Treasuries plus 85 bps. The rate will convert to a floating rate of Libor plus 63 bps.

In the final tranche, Bank of America sold $1.75 billion of 3.093% fixed-to-floating-rate notes due Oct. 1, 2025 at a spread of 108 bps over Treasuries. The notes will have a floating rate of Libor plus 109 bps.

BofA Merrill Lynch was the bookrunner.

Bank of America also was marketing a Canadian dollar-denominated offering of fixed-to-floating-rate senior notes on Wednesday.

The financial services company is based in Charlotte, N.C.

Citibank sells fixed, floaters

Citibank priced $2.25 billion of two-year fixed- and floating-rate notes (A1/A+/) on Wednesday, a market source said.

The company sold $1 billion of two-year floaters at Libor plus 26 bps.

Citibank priced $1.25 billion of 1.85% two-year fixed-rate notes at a spread of 50 bps over Treasuries.

Citigroup Global Markets Inc. was the bookrunner.

Citibank is a Sioux Falls, S.D.-based commercial and consumer banking products and services company.

Concho prices $1.8 billion

Concho Resources priced $1.8 billion of split-rated senior notes (Ba1/BBB-/BB) in two tranches on Wednesday on the tight side of guidance, according to market sources and a company press release.

The company sold $1 billion of 3.75%10-year notes at 99.636 and a spread of Treasuries plus 160 bps.

The offering of 10-year notes was initially talked at 187.5 bps over Treasuries and later guided in the 165 bps area.

In the second tranche, Concho Resources priced $800 million of 4.875% 30-year notes at 99.749 and a Treasuries plus 210 bps spread.

The 30-year notes were initially talked at Treasuries plus 237.5 bps. Price guidance later tightened to the 215 bps area.

A source said earlier in the day that both tranches could come 30 bps tighter than talk.

BofA Merrill Lynch, Barclays and Citigroup Global Markets were the bookrunners.

The split-rated deal priced off the high-grade desk.

Proceeds, along with cash on hand and borrowings from the company’s credit facility, will be used to fund a tender offer for Concho’s 5.5% senior notes due 2022 and 5.5% senior notes due 2023 and the redemption of any notes not tendered.

Concho is a Midland, Texas, oil and natural gas company focused on the Permian basin in southeastern New Mexico and West Texas.

Public Storage brings tranches

Public Storage sold $1 billion of senior notes (A2/A/) in two tranches on Wednesday, according to an FWP filing with the Securities and Exchange Commission.

The company priced $500 million of 2.37% five-year notes at par to yield a spread of Treasuries plus 60 bps.

Public Storage sold $500 million of 3.094% 10-year notes at par with a Treasuries plus 90 bps spread.

Morgan Stanley & Co. LLC, BofA Merrill Lynch and Wells Fargo Securities LLC, Citigroup Global Markets, Goldman Sachs and UBS Securities LLC were the bookrunners.

Proceeds will be used to make investments in self-storage facilities and in entities that own self-storage facilities, to develop self-storage facilities and for general corporate purposes.

Public Storage is a Glendale, Calif., real estate investment trust that acquires, develops, owns and operates self-storage facilities.

Washington Gas taps bonds

Washington Gas Light (A1/A/A) priced a $200 million tap of its 3.796% series K medium-term notes due Sept. 15, 2046 on Wednesday at 98.528 and a spread of 110 bps over Treasuries, according to a market source and a 424B5 filing with the SEC.

The notes tightened from initial talk in the Treasuries plus 125 bps area.

MUFG, RBC Capital Markets, LLC, BB&T Capital Markets and U.S. Bancorp Investments Inc. were the bookrunners.

The company originally priced $250 million of the notes at par on Sept. 13, 2016. The total outstanding now is $450 million.

Proceeds will be used to retire short-term debt primarily used to fund the company’s capital expenditure program and for general corporate purposes.

Washington Gas Light is a Washington, D.C.-based natural gas utility.

Nordic prices $1 billion

In other issuance on Wednesday, Nordic Investment Bank priced $1 billion of 1.625% global notes due Nov. 20, 2020 (Aaa/AAA/) at 99.952 and a spread of Treasuries plus 16.05 bps, according to a market source and an FWP filing with the SEC.

HSBC Bank plc, Merrill Lynch International, Nomura International plc and RBC Capital Markets were the bookrunners.

Nordic Investment Bank is an international financial institution owned by Denmark, Estonia, Finland, Iceland, Latvia, Lithuania, Norway and Sweden.

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