FMS prices tight; Freddie Mac passes; EIB on deck; Bank of America bonds firm in secondary

By Aleesia Forni

Virginia Beach, Aug. 27 – FMS Wertmanagement made its way to the primary market on Wednesday, pricing a $1.5 billion offering of three-year senior notes.

The day’s lone new issue sold at the tight end of price talk, which was set in the area of mid-swaps flat.

In other market news on Wednesday, Freddie Mac said that it would pass on issuing Reference Notes on its Aug. 27 announcement date.

In forward calendar news, European Investment Bank announced price talk for a planned $3 billion seven-year offering of notes on Wednesday.

Roughly $3 billion of new issuance has priced so far this week, and sources are expecting the slow pace of primary activity to continue on Thursday.

Issuance is expected to resume in September following the extended Labor Day holiday weekend.

Spreads in the investment-grade secondary market were mostly unchanged during Wednesday’s session.

The Markit CDX North American Investment Grade series 22 index was flat at a spread of 55 basis points.

Similarly, bank and financial paper was flat to slightly tighter.

Bank of America Corp.’s recently priced $1 billion of 1.7% notes due 2017 traded around 3 bps tighter on the day.

The bank’s 4.2% subordinated notes due 2024 also firmed, a market source said.

Investment-grade bank and brokerage CDS prices were unchanged to lower on Wednesday, according to a market source.

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