By Cristal Cody
Chicago, Sept. 7 – Santander Holdings USA, Inc. priced $500 million of 5.807% fixed-to-floating rate senior sustainability notes due 2026 (Baa3/BBB+/BBB+) on Tuesday, according to an FWP filing with the Securities and Exchange Commission and additional details from a market source.
The interest rate is fixed for the first three years and then resets on Sept. 9, 2025 to SOFR plus 232.8 basis points, with quarterly resets.
The notes priced at par with a spread of 225 bps over Treasuries versus talk in the Treasuries plus 250 bps area.
Starting March 8, 2023, the notes will be callable with a make-whole premium of Treasuries plus 35 bps. Then, the notes are callable on Sept. 9, 2025 and then again anytime after Aug. 9, 2026.
Santander Investment Securities Inc. is leading the sale and is the sustainability structuring agent. Other joint bookrunners are BNP Paribas Securities Corp., Credit Suisse Securities (USA) LLC and J.P. Morgan Securities LLC.
Proceeds will be credited to the company’s treasury account and incorporated into its general liquidity pool, with the proceeds marked for eligible assets that meet the eligibility criteria in the Santander Group green, social and sustainability funding global framework.
Boston-based Santander Holdings USA is a bank holding company.
| Issuer: | Santander Holdings USA, Inc.
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| Amount: | $500 million
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| Issue: | Fixed-to-floating rate senior sustainability notes
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| Maturity: | Sept. 9, 2026
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| Joint bookrunners: | Santander Investment Securities Inc., BNP Paribas Securities Corp., Credit Suisse Securities (USA) LLC and J.P. Morgan Securities LLC
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| Co-managers: | Loop Capital Markets LLC, MFR Securities, Inc. and Multi-Bank Securities, Inc.
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| Structuring agent: | Santander Investment Securities Inc.
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| Trustee: | Deutsche Bank Trust Co. Americas
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| Counsel to issuer: | Wachtell, Lipton, Rosen & Katz and McGuireWoods LLP
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| Counsel to underwriters: | Latham & Watkins LLP
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| Coupon: | 5.807% starting rate; resets to SOFR plus 232.8 bps starting Sept. 9, 2025 with quarterly resets
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| Price: | Par
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| Yield: | 5.807%
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| Spread: | Treasuries plus 225 bps
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| Call features: | Make-whole call starting March 8, 2023 at Treasuries plus 35 bps; callable at par on Sept. 9, 2025; callable at par starting Aug. 9, 2026
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| Trade date: | Sept. 6
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| Settlement date: | Sept. 9
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| Ratings: | Moody’s: Baa3
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| S&P: BBB+
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| Fitch: BBB+
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| Distribution: | SEC registered
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| Price talk: | Treasuries plus 250 bps area
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| Cusip: | 80282KBE5
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