Market eyes potential bank issuance in week ahead; Deutsche Bank, Japan Bank notes tighten

By Cristal Cody

Tupelo, Miss., July 14 – Corporate bank and financial issuance remains in the forefront following a week of strong primary action and after three major banks reported second quarter earnings on Friday.

Citigroup Inc., JPMorgan Chase & Co. and Wells Fargo & Co. beat analysts’ forecasts in their earnings. In the week ahead, Bank of America Corp., Goldman Sachs Group Inc. and Morgan Stanley release profit reports.

Deal action is expected to be strong in the upcoming week with market sources predicting about $25 billion to $30 billion of supply.

In primary action, Alimentation Couche-Tard Inc. announced plans on Friday to sell senior notes (Baa2) in a Rule 144A and Regulation S offering in the U.S. primary market and senior notes in Canada in a private placement.

The multi-tranche deal from the convenience store operator is estimated at $3 billion in U.S. and Canadian dollars, according to Moody’s Investors Service.

New bonds priced during the week traded mostly tighter.

Deutsche Bank AG, New York Branch’s $2.25 billion three-year notes (Baa2/A-) sold in two tranches on Monday traded on Friday about 9 basis points to more than 11 bps better than issuance.

Japan Bank for International Cooperation’s $5 billion of guaranteed senior bonds (A1/A+) that priced on Thursday firmed about 1 bp to 5 bps across the four tranches in the secondary market.

In other secondary trading, Citigroup, Inc.’s paper was mostly flat on the day.

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