
Metlife Global Funding I Issued $1.25 Billion in High-Grade Bonds
By Lynn NoahUpdated
Overview of the week’s deals
In the week ended November 27, 2015, there were only four issuers. Three US financials and one Yankee issuer raised money via high-grade bonds.
US financials were the biggest issuers of high-grade bonds in the week ended November 27, making up 81.1%, or $2.15 billion, of all issues. However, Yankee issuers were the only other issuers, making up 18.9% of all issues. US corporates, emerging markets, and the sovereign agencies and supranational sector did not see any issuances last week. The week ended November 27 brought the year-to-date issuance of high-grade corporate bonds to $1.44 trillion.
Issuances by high-grade corporates form part of mutual funds like the Nuveen Short-Term Bond Fund – Class A (FALTX) and the TIAA-CREF Bond Index Fund – Retail Class (TBILX).
Details of Metlife Global Funding I issue
A subsidiary of MetLife, Inc. (MET), Metlife Global Funding I is a special purpose statutory trust. It issued $1.25 billion in high-grade bonds rated Aa3/AA- in two parts:
- $500 million in 1.95% three-year funding agreement-backed notes issued at a spread of 73 basis points over similar-maturity Treasuries
- $750 million in 2.50% five-year funding agreement-backed notes issued at a spread of 83 basis points over similar-maturity Treasuries
Details of HCP Inc.’s issue
HCP Inc. (HCP) is a fully integrated real estate investment trust (or REIT) serving the healthcare industry. It issued high-grade bonds worth $600 million last week. The single-tranche Baa1/BBB+ rated seven-year issue was raised at a coupon of 4.0%. The high-grade bonds were issued at a spread of 205 basis points over similar-maturity Treasuries.
Details of Lloyds Banking Group Plc’s issue
Lloyds Banking Group Plc (LYG) is financial services group based in the United Kingdom. It issued high-grade bonds worth $500 million last week. The single-tranche Baa2/BBB- rated 30-year Sub T-2 bonds were raised at a coupon of 5.3%. The high-grade bonds were issued at a spread of 230 basis points over similar-maturity Treasuries.
Details of Stifel Financial Corporation’s issue
Stifel Financial Corporation (SY) is a full-service brokerage and investment banking firm. It issued $300 million in high-grade bonds last week. The single-tranche five-year issue was rated BBB- and was raised at a coupon of 3.5%. The high-grade bonds were issued at a spread of 190 basis points over similar-maturity Treasuries.