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Standard Chartered Issued the Most High-Grade Bonds Last Week

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Deals overview

US financials and Yankee issuers commanded 34.0% each of the primary market high-grade bond issuance in the week ended August 19, 2016, by issuing bonds worth $4.0 billion each.

Sovereign, agency, and supranational (or SAS) issuers made up 17.0% of issuances, while US corporate issuers made up the remaining 15.0% of total issuances.

The week ended August 19 brought the year-to-date issuance of high-grade corporate bonds to $1.1 trillion, 4% higher than issuances in the same period in 2015.

Issuances by high-grade corporates form part of the Vanguard Total Bond Market Index ETF (BND), the iShares 1-3 Year Credit Bond ETF (CSJ), and the SPDR Barclays Short Term Corporate Bond ETF (SCPB).

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Details of Standard Chartered’s issuance

Standard Chartered (SCBFF) issued A1/BBB+ rated high-grade bonds worth $3.0 billion in three parts on August 16:

  • $750 million in three-year senior FRNs (floating-rate notes) issued at LIBOR (Intercontinental Exchange London Interbank Offered Rate) plus 113 bps (basis points)
  • $1.0 billion in 2.1% three-year senior notes issued at a spread of 130 bps over similar-maturity Treasuries
  • $1.3 billion in 4.3% ten and a half-year subordinate notes issued at a spread of 280 bps over similar-maturity Treasuries

Details of Citigroup’s issuance

Citigroup (C) issued high-grade bonds worth $2.0 billion on August 19. The single-tranche, Baa1/BBB+ rated, seven-year FRNs not callable for six years were issued at LIBOR plus 148 bps.

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Details of Société Générale Bank’s issuance

Société Générale Bank issued high-grade bonds worth $1.0 billion on August 16. The single-tranche, Baa3/BBB rated, ten-year T2 issuance was raised at a coupon of 4.3%. Its high-grade bonds were issued at a spread of 275 bps over similar-maturity Treasuries.

Details of Entergy’s issuance

Entergy (ETR) issued high-grade bonds worth $750 million on August 16. The single-tranche, Baa3/BBB rated, ten-year issuance was raised at a coupon of 3.0%. The high-grade bonds were issued at a spread of 140 bps over similar-maturity Treasuries.

Details of UDR’s issuance

UDR (UDR) issued high-grade bonds worth $300 million on August 16. The single-tranche, Baa1/BBB+ rated, ten-year issuance was raised at a coupon of 3.0%. The high-grade bonds were issued at a spread of 137.5 bps over similar-maturity Treasuries.

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

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