Citigroup prices to solid demand, joins M&T Bank in primary; Citi, M&T, Verizon tighten

By Cristal Cody and Aleesia Forni

Virginia Beach, July 22 – Financial names continued to dominate the high-grade primary market on Tuesday, with Manufacturers and Traders Trust Co. and Citigroup Inc. bringing new deals.

Citigroup’s new $2 billion offering of five-year notes was met with solid demand, a source said, pricing around 10 basis points tighter compared to initial price thoughts.

The deal’s orderbook was around two times oversubscribed.

Tuesday’s primary also saw Manufacturers and Traders Trust, a subsidiary of M&T Bank Corp., sell a three-part $1.7 billion offering of senior notes.

There was also a $500 million add-on priced by Nederlandse Waterschapsbank NV.

So far this week, the investment-grade bond market has seen $8.75 billion of new issuance.

Sources had predicted the week to see around $15 billion of supply.

Investment-grade bond spreads tightened over the day, though trading remains light in typical summer fashion, sources said.

“It has been boring in secondary,” one trader said.

Citigroup’s 2.5% notes due 2019 traded about 1 bp tighter on the bid side going out.

M&T Bank’s offering of notes tightened 2 bps in the secondary market, a trader said.

Verizon Communications Inc.’s 6.55% bonds due 2043 remain active and traded slightly tighter versus Monday’s levels, a trader said.

The long bonds have the “most volume” of the company’s issues, the trader said.

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