American Express, FPL Group Capital price new issues; investment grade has yet to get going for week

By Andrea Heisinger

Omaha, Sept. 10 - The week started off at a moderate pace, with new issues including American Express Bank, FSB and American Express Centurion Bank, and FPL Group Capital Inc.

Both American Express issues were for $1 billion and had the same terms of 10-year 6% bank notes with a spread of Treasuries plus 170 basis points. The notes have a price of 99.755 with a yield of 6.033%.

Bookrunners were Banc of America Securities LLC, BNP Paribas Securities Corp. and Citigroup Global Markets Inc.

FPL Group Capital priced $250 million of 60-year 7.3% junior subordinated debentures at a spread of 300 bps over the 10-year Treasury.

The notes have a price of 99.775 with a yield of 7.333%. They have a fixed rate until Sept. 1, 2017, when they turn into floating-rate notes with a rate of three-month Libor plus 334.75 bps.

Bookrunners were Barclays Capital Inc., Greenwich Capital Markets, J.P. Morgan Securities Inc. and Wachovia Capital Markets LLC.

Hasbro on calendar

Hasbro, Inc. announced a new issue that will price in the next couple of days, an informed source said. The notes are planned in two tranches of 10-year and 30-year maturities.

The source said they were still doing discovery on the deal, and there was no tranche size or price talk yet.

The volume of issues paled in comparison to last week when there were more than $20 billion in new deals that priced in three days.

Sources predicted a day of stability would be needed Monday to urge other issues later in the week.

"The market really hasn't gotten going yet this week," a market source said, calling the day of trading "flat."

The new issue premium remained slightly high, a source said, in a broad sense of the market.

It is hard to tell if last week's wider spreads on new issues remain because of the lack of volume so far this week, the source said.

"It's just hard to say until we see more come out," they said.

It's also tough to tell whether this week's new issues will top that of last week's amount, composed of opportunistic issuers and those that had been put on hold during less than ideal market conditions.

"I think we're going to see a lot more new issues later in the week, and in the next couple of days especially."

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