Corporate supply thins; EIB prices five-year notes; Japan Bank on deck with two tranches

By Cristal Cody

Tupelo, Miss., Oct. 23 – High-grade primary action remained light on Tuesday as issuers are taking a wait-and-see approach due to market volatility.

Christus Health was the sole reported corporate issuer during the session with a $339.5 million 10-year bullet bond that priced in line with guidance.

In SSA supply, the European Investment Bank sold $3 billion of five-year global notes tighter than initial talk.

Coming up on Wednesday, Japan Bank for International Cooperation plans to price two tranches of guaranteed senior bonds registered with the Securities and Exchange Commission.

Price talk emerged over the session for the deal expected to include five- and 10-year notes.

Supply has been thin week to date. On Monday, Constellation Brands, Inc. priced a $2.15 billion four-part offering of senior notes and KeyCorp sold $500 million of seven-year senior medium-term notes.

Volume is expected to be on the lighter side this week with market sources calling for about $15 to $20 billion of high-grade supply. Deal volume also was thin last week with less than $20 billion of total corporate and SSA issuance.

The Markit CDX North American Investment Grade 31 index ended flat to modestly softer at a spread of 67 basis points.

Christus Health sells bonds

Christus Health priced $339,536,000 of 4.341% taxable revenue and refunding bonds due July 1, 2028 on Tuesday at a spread of Treasuries plus 120 bps, according to a market source.

The notes (A1/A+/) priced on top of guidance.

Barclays and J.P. Morgan Securities LLC were the bookrunners.

Christus Health is an international Catholic not-for-profit health system based in Irving, Texas.

EIB prices $3 billion

The European Investment Bank (Aaa/AAA/AAA) priced $3 billion of 3.125% global notes due Dec. 14, 2023 on Tuesday at a spread of mid-swaps plus 6 bps, or Treasuries plus 20.55 bps, according to a market source.

The notes were initially talked to price in the mid-swaps plus 7 bps area with guidance later firmed to the mid-swaps plus 6 bps area.

Goldman Sachs & Co. LLC, HSBC Securities (USA) Inc. and TD Securities (USA) LLC were the lead managers.

The lender for the European Union is based in Kirchberg, Luxembourg.

Japan Bank talks notes

Japan Bank for International Cooperation plans to price two tranches of guaranteed senior bonds (A1/A+/) on Wednesday, according to a market source and a 424B5 filing with the Securities and Exchange Commission.

The deal includes notes due Oct. 31, 2023 that were initially talked to price in the mid-swaps plus 3 bps area.

Initial price talk on the notes due Oct. 31, 2028 was in the mid-swaps plus 43 bps area.

Goldman Sachs International, BofA Merrill Lynch, Daiwa Capital Markets Europe Ltd. and Nomura International plc are the bookrunners.

The notes will be guaranteed by Japan.

The financial institution is based in Tokyo.

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