uploads///Total IG Bond Issuance in WE May

Abbvie Issued the Most High-Grade Bonds Last Week

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May. 18 2016, Updated 9:10 a.m. ET

Deals overview

US corporates dominated the primary market for high-grade bonds in the week ending May 13. They accounted for 57.0%, or $28.9 billion, of all the issues. US financials made up 23.9% of the total issuance. Yankee bond issuers made up 16.1% of all the issues.

The week ending May 13 brought the year-to-date issuance of high-grade corporate bonds to $673.5 billion.

Issuances by high-grade corporates form part of mutual funds and ETFs like the Strategic Advisers Core Income Fund (FPCIX), the Prudential Total Return Bond Fund – Class A (PDBAX), and the iShares 1-3 Year Credit Bond Fund (CSJ).

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Details of Abbvie’s issue

Abbvie (ABBV) is a global biopharmaceutical company. It issued Baa2/A- rated high-grade bonds worth $7.8 billion through five parts on May 9:

  • $1.8 billion in 2.3% five-year notes issued at a spread of 115 basis points over similar-maturity Treasuries
  • $1.0 billion in 2.9% seven-year notes issued at a spread of 135 basis points over similar-maturity Treasuries
  • $2.0 billion in 3.2% ten-year notes issued at a spread of 150 basis points over similar-maturity Treasuries
  • $1.0 billion in 4.3% 20-year bonds issued at a spread of 175 basis points over similar-maturity Treasuries
  • $2.0 billion in 4.5% 30-year bonds issued at a spread of 190 basis points over similar-maturity Treasuries

Details of Chevron’s issue

Chevron (CVX) is an oil exploration and refining company. It issued Aa2/AA- rated high-grade bonds worth $6.8 billion on May 9 through six parts:

  • $8.5 billion in two-year FRNs (floating rate notes) issued at three-month LIBOR + 50 basis points
  • $1.35 billion in 1.6% three-year notes issued at a spread of 70 basis points over similar-maturity Treasuries
  • $2.5 billion in five-year FRNs issued at three-month LIBOR + 95 basis points
  • $1.4 billion in 2.1% five-year notes issued at a spread of 90 basis points over similar-maturity Treasuries
  • $7.5 billion in 2.6% seven-year notes issued at a spread of 105 basis points over similar-maturity Treasuries
  • $2.3 billion in 3% ten-year notes issued at a spread of 120 basis points over similar-maturity Treasuries
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Details of Kraft Heinz’s issue

Kraft Heinz (KHC) is a global food company. It issued Baa3/BBB- rated high-grade bonds worth $5.0 billion on May 10 through two parts:

  • $2.0 billion in 3.0% ten-year notes issued at a spread of 130 basis points over similar-maturity Treasuries
  • $3.0 billion in 4.375% 30-year bonds issued at a spread of 180 basis points over similar-maturity Treasuries

Details of Intel’s issue

Intel (INTC) is a multinational technology company. It issued A1/A+ rated high-grade bonds worth $2.75 billion on May 12 through three parts:

  • $500 million in 1.7% five-year notes issued at a spread of 50 basis points over similar-maturity Treasuries
  • $1.0 billion in 2.6% ten-year notes issued at a spread of 87.5 basis points over similar-maturity Treasuries
  • $1.3 billion in 4.1% 30-year bonds issued at a spread of 155 basis points over similar-maturity Treasuries

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

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