By Cristal Cody
Chicago, March 16 – Charles Schwab Corp. sold a three-part offering comprised of one tranche of floating-rate senior notes due 2024, one tranche of fixed-rate notes due 2024 and a second tranche of fixed-rate notes due 2028 for a total of $4 billion, according to a market source.
The firm sold $1.5 billion of floating-rate notes due March 18, 2024 with a spread based on SOFR plus 50 basis points.
The first fixed-rate tranche, $1.25 billion of 0.75% notes due March 18, 2024, sold with a Treasuries plus 43 bps spread.
The other tranche of fixed-rate notes was sized at $1.25 billion as well. With a maturity of March 20, 2028, the notes came with a 2% coupon and a spread of Treasuries plus 75 bps.
The offering of the notes comes one day after Charles Schwab sold $2.25 billion of fixed-rate reset preferred stock.
All tranches will have calls based on a make-whole redemption until either one month or two months before maturity when the notes can be optionally called at par.
BofA Securities, Inc., Citigroup Global Markets Inc., Credit Suisse Securities (USA) LLC, J.P. Morgan Securities LLC and Morgan Stanley & Co. LLC are joint bookrunners.
Proceeds will be used for general corporate purposes. This will include redeeming or repaying the $600 million of floating-rate senior notes due May 21, 2021 and the $600 million of 3.25% senior notes also due May 21, 2021. Proceeds may also be used to purchase securities to augment liquidity and for the support of business growth, according to a 424B5 filing with the Securities and Exchange Commission on Tuesday morning.
Charles Schwab is a San Francisco-based financial services company.
| Issuer: | Charles Schwab Corp.
|
| Issue: | Notes
|
| Amount: | $4 billion
|
| Bookrunners: | BofA Securities, Inc., Citigroup Global Markets Inc., Credit Suisse Securities (USA) LLC, J.P. Morgan Securities LLC and Morgan Stanley & Co. LLC
|
| Trade date: | March 16
|
| Distribution: | SEC registered
|
|
|
| Floating-rate notes
|
| Issue: | Floating-rate notes
|
| Amount: | $1.5 billion
|
| Maturity: | March 18, 2024
|
| Coupon: | SOFR plus 50 bps
|
| Call features: | Make-whole call then par call
|
|
|
| 2024 notes
|
| Issue: | Fixed-rate notes
|
| Amount: | $1.25 billion
|
| Maturity: | March 18, 2024
|
| Coupon: | 0.75%
|
| Spread: | Treasuries plus 43 bps
|
| Call features: | Make-whole call then par call
|
|
|
| 2028 notes
|
| Issue: | Fixed-rate notes
|
| Amount: | $1.25 billion
|
| Maturity: | March 20, 2028
|
| Coupon: | 2%
|
| Spread: | Treasuries plus 75 bps
|
| Call features: | Make-whole call then par call
|
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