FIG leads way in quiet high-grade session

Tue Jul 8, 2014 5:45pm EDT

NEW YORK, July 8 (IFR) - FIG supply led the way in another relatively quiet session in the US high-grade market on Tuesday, with four issuers raising a total US$5.1bn.

The week's tally now stands at US$8bn, and at least one more decent-sized FIG trade is expected in the next couple days.

Sumitomo Mitsui Banking raised the most today, hitting the market with a US$3bn four-part trade that was greeted with a surge of investor orders. The trade, comprising three-year fixed and floaters, five-year fixed and 10-year fixed rate notes, came with IPTs that seemed to carry about 10bp-12bp in concessions.

But as orders built up to a final US$12.5bn book, the bookrunners tightened levels by 10bp-15bp to final pricing of Treasuries plus 45bp (3-yr fixed), Libor plus 32bp (3-yr floater), T+60bp (5-yr fixed) and T+85bp (10-yr fixed).

At these levels, the four tranches were judged to be paying about flat to 2bp in concessions compared with outstandings.

American Honda Finance Corp took out US$1bn, pricing a three-year fixed and floater whose levels were tightened by 10bp from IPTs as books totalled US$2.5bn. The US$650m three-year fixed had the most demand at US$1.75bn and was judged to carry negative 4bp in concession versus outstanding 2017s.

Other issuers today included ANZ with a US$500m two-year and Peru's Corporacion Financiera de Desarrollo SA (Cofide), which raised US$600m in five-year senior and a 15-non-call 10 subordinated Tier 2 notes that attracted an order book of US$7.75bn.

SMBC

Sumitomo Mitsui Banking Corp (SUMIBK), Aa3/A+, has announced initial price thoughts on a multi-tranche US$ senior unsecured notes exempt from SEC registration. Goldman Sachs, SMBC Nikko, Citigroup, Barclays, and Bank of America Merrill Lynch are dealers for the proposed offering. All the proposed bonds will be unconditionally and irrevocably guaranteed by SMBC's New York branch. UOP: GCP. Settle: 7/11/2014.

IPT: 3-year FXD T+55-60bp, 3-year FRN Libor equiv, 5-year T+70-75bp, 10-year T+100bp area

PRICE TALK: 3-year FXD T+55bp area, 3-year FRN Libor equiv, 5-year T+65-70bp, 10-year FXD T+95bp area

FINAL GUIDANCE: 3-year FXD T+50bp area, 3-year FRN Libor equiv, 5-year T+65bp area, 10-year T+90bp area. Area is +/- 5bp.

LAUNCH: US$3bn 4-part. US$1bn 3-year FXD at T+45bp, US$500m 3-year FRN at 3mL+32bp, US$1bn 5-year at T+60bp, US$500m 10-year at T+85bp.

PRICED: USD3bn 4-part total.

- USD1bn 1.35% 3-year FXD. At 99.874, yld 1.393%. T+45bp.

- USD500m 3-year FRN. At 100, floats 3mL+32bp.

- USD1bn 2.25% 5-year. At 99.803, yld 2.292%. T+60bp.

- USD500m 3.40% 10-year. At 99.924, yld 3.409%. T+85bp.

BOOK: US$12.5bn. 3-year floater: US$1.95bn; 3-year fixed: US$2.65bn; 5-year: US$4.6bn; 10-year: US$3.3bn

NIC: 3-year: flat, 5-year: 2bp 10-year: 2bp

COMPS:

1.300% January 10, 2017 at G+45bp

2.450% January 10, 2019 at G+58bp

3.950% January 10, 2024 at G+83bp

MUFG (Aa3/A+) 1.200% March 10, 2017 at T+40bp

MUFG (Aa3/A+) 2.300% March 10, 2019 at T+44bp

MUFG (Aa3/A+) 3.750% March 10, 2024 at T+83bp

AMERICAN HONDA FINANCE

American Honda Finance Corp (HNDA), A1/A+ (s/s), announced a US$ benchmark senior unsecured SEC registered 3-year (7/14/2017) fixed and/or FRN. The bookrunners include Citigroup, JP Morgan, Mizuho and Morgan Stanley. Co-managers: Credit Suisse, Deutsche Bank, Royal Bank of Scotland, Sumitimo and Societe Generale. UOP: GCP. Settle: T+5.

IPTs: 3-year FXD T+40bp area, 3-year FRN Libor equiv

PRICE GUIDANCE: 3-year FXD T+30-32bp, 3-year FRN Libor equiv

LAUNCH: US$1bn 2-part. US$650m 3-year FXD at T+30bp, US$350m 3-year FRN at 3mL+17bp.

PRICED: US$1bn 2-part total.

- US$650m 1.20% 3-year (7/14/2017) FXD. At 99.859, yld 1.248%. T+30bp. MWC T+5bp. First pay 1/14/2015.

- US$350m 3-year (7/14/2017) FRN. At 100, floats at 3mL+17bp. First pay 10/14/2014.

BOOK: 3-year FRN: US$750m, 3-year FXD: US$1.75bn

NIC: negative 4bp

COMPS:

1.500% September 11, 2017 at G+34bp

ANZ

Australia and New Zealand Banking Group Limited (ANZ), Aa2/AA-/AA-, announced a US$500m 144a/Reg S 2-year (7/15/2016) FRN. RBC is sole books. Settle: T+5 (7/15/2014).

UPDATE: US$500m 2-year (7/15/2016) FRN. At 100, floats at 3mL+18bp.

PRICED: USD500m 2-year (7/15/16) FRN. At 100, floats at 3mL+18bp.

BOOK: Not disclosed

COFIDE (CORPORACION FINANCIERA DE DESARROLLO SA)

Peru's Corporacion Financiera de Desarrollo SA (Cofide) has announced a US$600m 144A/Reg S two-part bond issue comprised of a five-year senior note (NR/BBB+/BBB+) and a 15yrNC10 subordinated (Tier 2) note (NR/BBB/BBB). Citigroup, Morgan Stanley and Standard Chartered are the lead managers.

IPTs: 5-year T+180a; 15-year NC10 T+300a

GUIDANCE: 5-year T+170bp (+/-5bp), 15-year NC10 Tier 2 T+287.5 (+/-12.5bp)

LAUNCH: US$600m two-part. US$300m 5-year senior T+160bp, US$300m 15-year NC10 Tier 2 T+270bp.

PRICED: USD600m two-part total

- USD300m 3.25% 5-year senior (07/15/2019). At 99.785, yld 3.297%. T+160bp

- USD300m 5.25% 15NC10 Tier 2 (07/15/2029). At 99.866, yld 5.263%. T+270bp

BOOK: US$7.75bn. 5-year: US$3.25bn; 15NC10: US$4.5bn

(Reporting by Shankar Ramakrishnan and Michael Gambale; Eduiting by Marc Carnegie)

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