Morning Commentary: Investment-grade bond spreads firm; Abbey National trades tighter

By Aleesia Forni

Virginia Beach, Sept. 30 – High-grade bond spreads firmed early Tuesday following a weaker Monday session.

The Markit CDX North American Investment Grade series 22 index was 3 basis points tighter at a spread of 64 bps.

Bank and financial paper was around 1 bp to 2 bps better at mid-morning, a trader said.

Abbey National Treasury Services plc’s $500 million of 1.65% three-year notes, which sold at Treasuries plus 62.5 bps on Wednesday, were quoted 2 bps tighter at 61 bps bid, 59 bps offered.

The sale also included $250 million of floating-rate notes due 2017 sold at par to yield Libor plus 41 bps.

BofA Merrill Lynch, Deutsche Bank Securities Inc. and Santander were the bookrunners.

The financial services company is based in London.

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