Morgan Stanley, AutoZone in market; bank, financial paper flat to better; credit spreads firm

By Cristal Cody

Eureka Springs, Ark., April 18 – Two high-grade issuers tapped the primary market on Monday, bringing $4.15 billion of bonds.

Market sources expect about $30 billion of issuance for the week.

Morgan Stanley sold $3.5 billion of global medium-term senior notes (A3/BBB+/A) in two tranches.

AutoZone, Inc. priced $650 million of senior notes (Baa1/BBB/BBB) in two parts.

Investment-grade bank and financial paper traded flat to modestly better earlier in the day.

Bank of America Corp.’s senior notes (Baa1/BBB+/A) were unchanged to about 3 basis points tighter.

Credit Suisse Group Funding (Guernsey) Ltd.’s senior notes due 2026 improved about 1 bp from Friday.

Wells Fargo & Co.’s new 3% senior notes due 2026 were unchanged.

The Markit CDX North American Investment Grade index opened soft on Monday but ended the session 2 bps tighter at a spread of 78 bps.

Morgan Stanley prices notes

Morgan Stanley sold $3.5 billion of series F five-year global medium-term senior notes in two tranches on Monday, according to a market source and an FWP filing with the Securities and Exchange Commission.

The $2.5 billion tranche of 2.5% notes due April 21, 2021 priced at 99.664 to yield 2.572%. The spread was 135 bps over Treasuries.

Morgan Stanley sold $1 billion of floating-rate notes due April 21, 2021 at par to yield Libor plus 140 bps.

Morgan Stanley & Co. LLC was the bookrunner.

The financial services company is based in New York City.

AutoZone brings $650 million

AutoZone sold $650 million of senior notes in two parts during Monday’s session, according to an FWP filing with the SEC.

In the first tranche, the company priced $250 million of 1.625% notes due April 21, 2019 at 99.93 to yield 1.649%, or a spread of 75 bps over Treasuries.

AutoZone brought to market $400 million of 3.125% 10-year notes at 99.974 to yield 3.128%. The notes due April 21, 2026 priced with a spread of 135 bps plus Treasuries.

Barclays, BofA Merrill Lynch and SunTrust Robinson Humphrey, Inc. were the bookrunners.

Proceeds from the deal will be used for general corporate purposes.

AutoZone is a Memphis-based auto parts and supplies retailer.

Bank of America firms

Bank of America’s 3.5% notes due 2026 traded tighter at 170 bps offered early in the day, according to a market source.

The notes priced in a $2.5 billion tranche on Thursday at a spread of Treasuries plus 173 bps.

The bank is based in Charlotte, N.C.

Credit Suisse improves

Credit Suisse Group Funding’s 4.55% notes due 2026 tightened about 1 bp from Friday to 267 bps offered in trading on Monday morning, according to a market source.

The company sold $2 billion of the notes (Baa3/BBB+/A) on Wednesday at 280 bps over Treasuries.

The financial services company is based in Zurich.

Wells Fargo unchanged

Wells Fargo’s 3% notes due 2026 were flat in morning secondary trading at 128 bps offered, according to a market source.

The company sold $3 billion of the notes on Friday at a spread of 130 bps over Treasuries.

San Francisco-based Wells Fargo provides retail, commercial and corporate banking services.

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