Morning Commentary: Citigroup, Bank of America firm; Exxon Mobil tightens; Libor yield drops

By Cristal Cody

Eureka Springs, Ark., March 2 – New high-grade bonds priced in the first two days of the week remained tight in secondary trading early Wednesday.

Citigroup Inc.’s $1.5 billion offering of subordinated notes due 2026 sold on Tuesday firmed 2 basis points in the secondary market.

Bank of America Corp.’s $2 billion offering on Monday of 4.4% medium-term subordinated notes due 2026 traded about 1 bp better.

Exxon Mobil Corp.’s notes (Aaa/AAA) priced in a $12 billion eight-tranche offering on Monday remain tight in the secondary market.

The three-month Libor yield was down 1 bp to 63 bps early Wednesday.

Trading volume jumped to $21.2 billion on Tuesday, up from $18.3 billion of investment-grade bonds traded on Monday, according to Trace.

Citigroup improves

Citigroup's 4.6% subordinated notes due 2026 firmed 2 bps to 278 bps offered in secondary trading, a market source said.

Citigroup sold $1.5 billion of the notes (Baa3/BBB/A-) on Tuesday at a spread of Treasuries plus 280 bps.

The banking and financial services company is based in New York.

Bank of America firms

Bank of America’s 4.45% subordinated notes due 2026 firmed about 1 bp from Tuesday to 264 bps offered, a market source said.

Bank of America sold $2 billion of the notes on Monday at 270 bps over Treasuries.

The financial services company is based in Charlotte, N.C.

Exxon Mobil tightens

Exxon Mobil’s $2.5 billion tranche of 4.114% bonds due 2046 remain tight in the secondary market and traded at 136 bps offered early Wednesday, according to a market source.

The company sold the notes on Monday at a spread of 150 bps over Treasuries.

Exxon Mobil is an energy company based in Irving, Texas.

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