Primary stays quiet despite upswing in tone; Citi, JPMorgan, Goldman weak

By Aleesia Forni and Cristal Cody

New York, Feb. 12 – The tone of the high-grade bond market improved on Friday, though that was not enough to persuade any issuers to access the primary.

The empty session closed out a week that saw around $865 million of new issuance from just two issuers, Landwirtschaftliche Rentenbank and Ford Motor Credit Co. LLC.

The final tally is a far cry from what was predicted to be around $10 billion to $15 billion of supply, with volatile market conditions keeping a majority of issuers on the sidelines.

With ongoing market volatility a significant factor, ranges for new investment-grade issuance in the week ahead vary from $5 billion to around $15 billion.

Investment-grade bank and financial paper traded mostly wider over the day, while credit spreads improved.

Deutsche Bank AG’s 4.1% notes due 2026 priced in January were quoted on Friday trading 100 basis points wider than issuance. The bonds were active in secondary trading at the start of the day after Deutsche Bank announced a tender offer to purchase $2 billion of dollar-denominated senior notes and €3 billion of euro-denominated notes.

Citigroup Inc.’s 3.7% subordinated notes due 2026 widened 4 bps on Friday.

JPMorgan Chase & Co.’s 4.25% subordinated bonds due 2027 headed out 7 bps weaker in the secondary market.

Goldman Sachs Group Inc.’s 4.25% subordinated notes due 2025 widened 15 bps during the session.

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