KfW sells $4 billion notes; Sweden raises $2 billion; Fannie Mae prices; credit spreads ease

By Cristal Cody

Eureka Springs, Ark., Aug. 31 – More than $9 billion of bonds priced in the high-grade dollar market on Wednesday from KfW, the Kingdom of Sweden and Fannie Mae.

KfW sold $4 billion of two-year global notes during the session.

Sweden came early in the day to price a $2 billion offering of five-year benchmark bonds.

Fannie Mae sold $3.5 billion of 1% three-year Benchmark Notes on Wednesday.

The Markit CDX North American Investment Grade index widened about 2 basis points to close the day at a spread of 73 bps.

Coca-Cola Co.’s notes (Aa3/AA-/A+) priced on Monday traded about 1 bp to 2 bps softer in the secondary market earlier on Wednesday.

KfW prices $4 billion

KfW (Aaa/AAA/AAA) sold $4 billion of 1% two-year global notes at 99.945 on Wednesday, according to an FWP filing with the Securities and Exchange Commission.

Goldman Sachs International, Nomura Securities International, Inc. and RBC Capital Markets, LLC were the managers.

The notes are guaranteed by the Federal Republic of Germany.

KfW is a government-backed bank based in Frankfurt.

Sweden prices $2 billion

Sweden (Aaa/AAA/AAA) priced a $2 billion 1.25% five-year benchmark bond at 99.422 to yield 1.37% on Wednesday, according to a release.

The bonds priced at mid-swaps plus 17 bps.

Barclays, Citigroup Global Markets Inc. and HSBC Securities (USA) Inc. were the lead managers.

Market conditions were favorable, and the bonds were placed with several types of investors around the world, Maria Norstrom, head of funding at the Swedish National Debt Office, said in the release.

The bulk went to banks and central banks, which took 76% of the bonds, while fund managers purchased 22%.

European and other investors purchased 38% of the benchmark bonds. Investors in the Americas bought 26%, while Nordics acquired 21%, investors in Asia took 11% and investors in the Middle East and Africa bought 4% of the bonds.

The debt office plans to sell a total of SEK 59 billion of foreign-currency bonds in 2016. Following Wednesday’s offering, SEK 25 billion remains to be funded.

Proceeds from the offering will be used to refinance loans to Sveriges Riksbank, the central bank of Sweden.

Fannie Mae prices $3.5 billion

Fannie Mae sold $3.5 billion of 1% three-year Benchmark Notes on Wednesday at 99.844 to yield 1.053%, according to a press release.

The notes priced with a spread of 15 bps over Treasuries.

Barclays, Deutsche Bank Securities Inc. and Goldman Sachs & Co. were the lead managers.

Fannie Mae is a mortgage credit provider based in Washington, D.C.

Coca-Cola softens

Coca-Cola’s 1.55% notes due 2021 traded wider at 42 bps offered in the secondary market earlier in the day, a source said.

The company sold $1 billion of the five-year notes on Monday at a spread of 40 bps over Treasuries.

Coca-Cola’s 2.25% notes due 2026 eased to 71 bps offered.

The 10-year notes were priced in a $1 billion tranche in Monday’s offering at 70 bps plus Treasuries.

Coca-Cola is an Atlanta-based beverage company.

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