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Visa Led the High-Grade Bond Issuance in December 2015

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Deals overview

US financials were the biggest issuers of high-grade bonds in December. They accounted for 37.3%, or $21.3 billion, of all the issues. US corporates were the second-biggest issuers. They accounted for 35.7% of all the issues. Meanwhile, Yankee bond issuers raised $11.1 billion through high-grade bonds. They accounted for 19.5% of the total issuance. Emerging market issuers issued $3.5 billion worth of high-grade bonds in December 2015.

Issuances by high-grade corporates form part of mutual funds like the T. Rowe Price New Income Fund (PRCIX) and the Strategic Advisers Core Income Fund (FPCIX).

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Major issues in December

  • Visa (V) is a global payments company. It issued A1/A+ rated high-grade bonds worth $16.0 billion on December 9. Visa will use the proceeds for the acquisition of Visa Europe Limited. It was the largest issue in December.
  • Schlumberger (SLB) issued A2/AA- rated high-grade bonds worth $6.0 billion on December 10. It will use the net proceeds from the offering for general corporate purposes. It will use the funds to finance a portion of the consideration of Schlumberger’s acquisition of Cameron International (CAM).
  • McDonald’s (MCD) is a global foodservice retailer. It issued Baa1/BBB+ rated high-grade bonds worth $6.0 billion on December 2.
  • Credit Suisse Group Funding is a subsidiary of Credit Suisse AG (CS). It issued high-grade bonds worth $2.0 billion on December 7.
  • Toronto-Dominion Bank (TD) is headquartered in Toronto, Canada. Along with its subsidiaries, it offers a full range of financial products and services. It issued Aa1/AA- rated high-grade bonds worth $2.0 billion on December 7.

In the next part, we’ll analyze investment-grade bond fund flows.

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