Published on 4/12/2022 in the Prospect News Investment Grade Daily.
New Issue: MUFG details $2 billion fixed-to-fixed reset rate notes in three parts
By Rebecca Melvin and Cristal Cody
Concord, N.H., April 12 – Mitsubishi UFJ Financial Group, Inc. (MUFG) gave additional details of its $2 billion of senior callable fixed-to-fixed reset rate notes (A1/A-/A-) that priced in three tranches at par on Monday, according to a FWP filed with the Securities and Exchange Commission and details from a market source.
The first tranche maturing April 17, 2026, totaled $500 million with interest at 3.837%, or 112.5 basis points over Treasuries, versus spread talk in the 125 bps to 130 bps area. The coupon resets one year before maturity to a fixed rate equal to Treasuries plus 112.5 bps.
The second tranche due April 19, 2028 totaled $800 million with interest at 4.08%, or 130 bps over Treasuries, versus spread talk in the 145 bps to 150 bps area. The coupon resets one year before maturity to a fixed rate equal to Treasuries plus 130 bps.
The third tranche due April 19, 2033, totaled $700 million with interest at 4.315%, or 155 bps over Treasuries, versus spread talk in the 170 bps to 175 bps area. The coupon resets one year before maturity to a fixed rate equal to Treasuries plus 155 bps.
The notes are callable one year prior to maturity at par.
Morgan Stanley & Co. LLC and MUFG are bookrunners for all three notes; Citigroup Global Markets Inc. is another bookrunner for the four-year notes; J.P. Morgan Securities LLC is another bookrunner for the six-year notes; and BofA Securities Inc. is another bookrunner for the 11-year notes.
Proceeds will be used for operations of Bank of Tokyo-Mitsubishi UFJ, Ltd.
The bank is based in Tokyo.
| Issuer: | Mitsubishi UFJ Financial Group, Inc.
|
| Amount: | $2 billion
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| Issue: | Callable fixed-to-fixed reset rate notes
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| Co-managers: | Bank of China Ltd., BNP Paribas, Credit Agricole CIB, HSBC Securities (USA) Inc., Natixis Securities Americas LLC, Nomura Securities International, Inc., RBC Capital Markets LLC, Societe Generale, UBS Securities LLC and Wells Fargo Securities, LLC
|
| Trustee: | Bank of New York Mellon
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| Counsel to issuer: | Paul, Weiss, Rifkind, Wharton & Garrison LLP and Nagashima Ohno & Tsunematsu
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| Counsel to bookrunners: | Simpson Thacher & Bartlett LLP
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| Trade date: | April 11
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| Settlement date: | April 19
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| Ratings: | Moody’s: A1
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| S&P: A-
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| Fitch: A-
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| Distribution: | SEC registered
|
|
|
| 2026 notes
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| Amount: | $500 million
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| Maturity: | April 17, 2026
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| Bookrunners: | Morgan Stanley & Co. LLC, MUFG and Citigroup Global Markets Inc.
|
| Senior co-managers: | Barclays, BofA Securities, Inc. and J.P. Morgan Securities LLC
|
| Coupon: | 3.837% until April 17, 2025, then resets to fixed rate equal to Treasuries plus 112.5 bps
|
| Price: | Par
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| Yield: | 3.837%
|
| Spread: | Treasuries plus 112.5 bps
|
| Call features: | Par plus interest on reset date
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| Price talk: | Treasuries plus 125 bps to 130 bps area
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| Cusip: | 606822CF9
|
|
|
| 2028 notes
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| Amount: | $800 million
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| Maturity: | April 19, 2028
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| Bookrunners: | Morgan Stanley & Co. LLC, MUFG and J.P. Morgan Securities LLC
|
| Senior co-managers: | Barclays, BofA Securities, Inc. and Citigroup Global Markets Inc.
|
| Coupon: | 4.08% until April 19, 2027, then resets to fixed rate equal to Treasuries plus 130 bps
|
| Price: | Par
|
| Yield: | 4.08%
|
| Spread: | Treasuries plus 130 bps
|
| Call features: | Par plus interest on reset date
|
| Price talk: | Treasuries plus 145 bps to 150 bps area
|
| Cusip: | 606822CE2
|
|
|
| 2033 notes
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| Amount: | $700 million
|
| Maturity: | April 19, 2033
|
| Bookrunners: | Morgan Stanley & Co. LLC, MUFG and BofA Securities Inc.
|
| Senior co-managers: | Barclays, Citigroup Global Markets Inc. and J.P. Morgan Securities LLC
|
| Coupon: | 4.315% until April 19, 2032, then resets to fixed rate equal to Treasuries plus 155 bps
|
| Price: | Par
|
| Yield: | 4.315%
|
| Spread: | Treasuries plus 155 bps
|
| Call features: | Par plus interest on reset date
|
| Price talk: | Treasuries plus 170 bps to 175 bps area
|
| Cusip: | 606822CG7
|
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