Morning Commentary: Inter-American Development Bank offers five-year notes; pipeline builds

By Cristal Cody

Tupelo, Miss., Jan. 10 – Inter-American Development Bank announced plans on Wednesday for a benchmark-sized offering of dollar-denominated global notes.

The bank is expected to price five-year global notes that were initially talked to price in the mid-swaps plus 13 basis points area, a source said.

Deal action was strong in the first two sessions of the week. On Tuesday, high-grade issuance was led by Sempra Energy’s $5 billion seven-part sale, Sumitomo Mitsui Financial Group Inc.’s $4.75 billion five-part bond deal and the European Investment Bank’s $5 billion offering of five-year global notes.

About $25 billion to $30 billion of supply is expected by market sources for the week.

Several issuers are in the deal pipeline, including Patterson-UTI Energy, Inc. and United Community Banks, Inc.

International Finance Corp. also was expected to tap its floating-rate notes due Dec. 15, 2022. The company originally sold $500 million of the notes (Aaa/AAA) on July 11, 2017 at par to yield Libor plus 7 bps and priced a $250 million add-on on Nov. 2 with a Libor plus 6 bps yield. The total outstanding is $750 million.

Elsewhere, in the previous session, investment-grade secondary market volume was heavy on Tuesday with $20.71 billion of bonds traded, Trace reported. On Monday, $14.67 billion of investment-grade issues were traded.

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