Kommunalbanken, NWB Bank price; issuance to pick up following holiday weekend; spreads ease

By Aleesia Forni

Virginia Beach, Aug. 29 – A pair of foreign financials made their way to Friday’s primary market, closing out a sleepy week for investment-grade bonds.

Kommunalbanken AS sold a $300 million offering of seven-year floating-rate notes during the session in line with talk.

Meanwhile, Nederlandse Waterschapsbank NV came to market with a $500 million issue of five-year notes.

With the late-August lull in full swing, the high-grade primary saw $6.75 billion price during the week.

Sources are expecting market activity to resume following the Labor Day holiday-extended weekend, with around $20 billion of supply forecasted for the shortened week.

Meanwhile, Lipper reported inflows of $922.3 million into corporate investment-grade funds for the week ended Aug. 27, up slightly from last week’s $1.02 billion of inflows.

The year-to-date total inflows now top $51 billion.

In secondary market action, high-grade bond spreads traded better on Friday, while Bank of America Corp.’s bonds eased.

The Markit CDX North American Investment Grade series 22 index was flat at a spread of 57 basis points.

Kommunalbanken brings $300 million

Kommunalbanken priced $300 million of seven-year floating-rate notes (Aaa/AAA/) on Friday at par to yield Libor plus 13 bps, an informed source said.

The notes sold in line with talk.

BofA Merrill Lynch, BNP Paribas and Goldman Sachs & Co. were the bookrunners.

The Norwegian government-funded lender to municipalities is based in Oslo.

NWB Bank new issue

Nederlandse Waterschapsbank priced $500 million of 1.75% five-year notes (Aaa/AA+/) on Friday at mid-swaps plus 9 bps, or Treasuries plus 23.65 bps, a market source said.

The notes sold at 99.416 to yield 1.873%.

Barclays was the bookrunner.

The financial services company for the public sector is based in the Hague, the Netherlands.

Bank of America widens

Bank of America’s bonds due 2017 eased during the session.

The bank’s $1 billion of 1.7% three-year issue of senior notes was quoted 1 bp wider on Friday at 71 bps bid.

Pricing was at a spread of Treasuries plus 80 bps.

The issue was sold as part of a $4.5 billion three-part offering on Aug. 21.

Bank of America is a financial services company based in Charlotte, N.C.

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