EBRD, TowneBank price; Japan Bank for International Cooperation markets bond offering

By Cristal Cody

Tupelo, Miss., July 12 – Primary action slowed on Wednesday with market distractions including Federal Reserve chairman Janet Yellen’s Congressional testimony and the Bank of Canada’s first interest rate hike since 2010 during the session.

The European Bank for Reconstruction and Development sold $500 million of three-year global floating-rate notes in line with price talk.

TowneBank priced $250 million of 10-year fixed-to-floating rate subordinated notes.

Also, SMBC Aviation Capital Ltd. was expected to price a $500 million offering of five-year notes.

Japan Bank for International Cooperation joined the deal pipeline with a four-part offering of dollar-denominated guaranteed bonds. The notes were talked to price on Thursday.

The Markit CDX North American Investment Grade index tightened about 2 basis points to close at a spread of 60 bps.

In secondary trading on Wednesday, AT&T Inc.’s notes (Baa1/BBB+/A-) were mixed.

Verizon Communications Inc.’s 4.125% notes due March 16, 2027 eased 2 bps.

EBRD prices on top of talk

The European Bank for Reconstruction and Development (Aaa/AAA/AAA) priced $500 million of three-year global floating-rate notes in line with talk at Libor plus 1 bp on Wednesday, according to a market source.

BofA Merrill Lynch, HSBC Bank plc and RBC Capital Markets, LLC were the lead managers.

The financial institution is based in London.

TowneBank taps market

TowneBank came with $250 million of 4.5% 10-year fixed-to-floating rate subordinated notes priced at par on Wednesday, according to a press release.

The notes will bear a fixed interest rate to but excluding July 30, 2022. Thereafter, the notes will have a floating rate equal to Libor plus 255 bps.

Sandler O’Neill + Partners, LP was the bookrunner.

The company plans to use the proceeds for general corporate purposes, which may include supporting its growth organically or through acquisitions.

TowneBank is a Portsmouth, Va.-based provider of retail and commercial banking products and services through its subsidiaries.

SMBC offers $500 million

SMBC Aviation Capital (/BBB+/A-) launched a $500 million offering of notes due July 19, 2022 on Wednesday at a spread of 115 bps over Treasuries, according to a market source.

Citigroup Global Markets Inc., Credit Agricole CIB, Goldman Sachs & Co. LLC, J.P. Morgan Securities LLC, RBC Capital Markets and SMBC Nikko Securities America, Inc. are the lead managers.

Final pricing details were not available by press time.

The company held fixed income investor calls on Monday and Tuesday for the offering.

SMBC Aviation Capital is a Dublin-based global aircraft leasing company.

Japan Bank talks deal

Japan Bank for International Cooperation (A1/A+) plans to price dollar-denominated guaranteed bonds in four parts on Thursday, according to a market source and a 424B5 filed with the Securities and Exchange Commission.

The three-year fixed-rate notes were talked to price in the mid-swaps plus 43 bps area.

The tranche of five-year notes was talked to price in the mid-swaps plus 57 bps area.

Also, the 10-year notes were guided to come to the primary market in the mid-swaps plus 72 bps area.

The deal is expected to include a tranche of three-year floating-rate notes that will bear interest at Libor plus a spread.

BofA Merrill Lynch, Daiwa Capital Markets Europe, JPMorgan and Nomura are the bookrunners.

The non-callable notes will be guaranteed by Japan.

Proceeds will be used for the Tokyo financial institution’s ordinary operations.

AT&T mixed

AT&T’s 4.25% notes due March 1, 2027 firmed 4 bps to 150 bps bid in the secondary market on Wednesday, a source said.

The company sold $2 billion of the notes on Jan. 31, 2017 at a spread of Treasuries plus 180 bps.

AT&T’s 5.45% notes due March 1, 2047 eased 6 bps to 216 bps bid in secondary trading.

The $2 billion tranche of bonds priced in the Jan. 31 sale at a Treasuries plus 240 bps spread.

AT&T is a Dallas-based telecommunications company.

Verizon eases

Verizon Communications’ 4.125% notes due March 16, 2027 softened 2 bps to 147 bps bid, according to a market source.

Verizon sold $3.25 billion of the notes (Baa1/BBB+/A-) on March 13 at a spread of Treasuries plus 160 bps.

The telecommunications company is based in New York City.

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