Altria prices $11.5 billion; 3M, JPMorgan, Bank of New Zealand, PNC, Bank of England print

By Cristal Cody

Tupelo, Miss., Feb. 12 – Altria Group Inc. led deal volume in the high-grade bond market on Tuesday with an $11.5 billion seven-tranche offering of senior notes.

The issuance came a day after Altria priced a €4.25 billion four-part offering of reverse Yankee bonds.

Volume was heavy during the session and included a $2.25 billion four-tranche offering of medium-term notes from 3M Co.

In addition, JPMorgan Chase Bank, NA priced $1.5 billion of two-year senior floating-rate notes.

Bank of New Zealand priced $750 million of five-year notes during the session.

Also, PNC Financial Services Group, Inc. priced an upsized $300 million add-on to its 3.5% senior notes due Jan. 23, 2024.

In sovereign, supranational and agency volume, the Bank of England priced $2 billion of three-year notes tighter than initial talk.

BNG Bank NV brought an upsized $300 million add-on to its senior floating-rate notes due March 11, 2022 in line with guidance.

Week to date, more than $26 billion of high-grade bonds have priced.

Syndicate sources expected about $25 billion to $30 billion of total supply for the week.

The Markit CDX North American Investment Grade 31 index firmed more than 2 basis points over the session to a spread of 66 bps.

Atria sells seven tranches

Altria Group sold $11.5 billion of senior notes (A3/BBB/) in seven tranches on Tuesday, according to a market source.

The company priced $1 billion of 3.49% three-year note with a spread of 100 bps over Treasuries.

A $1 billion tranche of 3.8% five-year notes were priced with a Treasuries plus 135 bps spread.

Altria sold $1.5 billion of 4.4% seven-year notes at a spread of 185 bps over Treasuries.

A $3 billion tranche of 4.8% 10-year notes were sold with a 215 bps over Treasuries spread.

The company priced $2 billion of 5.8% 20-year notes at a spread of 280 bps over Treasuries.

A $2.5 billion tranche of 5.95% 30-year notes were sold with a Treasuries plus 295 bps spread.

In the final slice, the company sold $500 million of 6.2% 40-year notes at a spread of 320 bps over Treasuries.

The notes priced on the tight side of guidance and better than initial talk.

The offering was upsized from an initially expected six-tranche deal.

Barclays, Citigroup Global Markets Inc., Credit Suisse Securities (USA) LLC, Deutsche Bank Securities Inc., Goldman Sachs & Co. LLC, J.P. Morgan Securities LLC, Mizuho Securities USA Inc. and Scotia Capital (USA) Inc. were the bookrunners.

The notes are guaranteed by Philip Morris USA Inc.

The Richmond, Va.-based company produces cigarette and tobacco products.

3M prices $2.25 billion

3M priced $2.25 billion of medium-term notes (A1/AA-/) in four tranches on Tuesday, according to a market source.

The company sold $450 million of 2.75% three-year notes at a spread of 28 bps over Treasuries.

A $500 million add-on to the company’s 3.25% notes due Feb. 14, 2024 priced at a Treasuries plus 50 bps spread.

3M sold originally sold $300 million of the notes on Sept. 11 at 99.756 to yield 3.3% and a Treasuries plus 43 bps spread. The total outstanding is now $800 million.

In a new issue tranche, 3M sold $800 million of 3.375% 10-year notes at a Treasuries plus 70 bps spread.

A $500 million reopening of the company’s 4% notes due Sept. 14, 2048 priced at a spread of 87 bps over Treasuries.

3M originally sold $650 million of the bonds on Sept. 11 at 98.811 to yield 4.069% and a spread of 95 bps plus Treasuries. The total outstanding is now $1.15 billion.

Morgan Stanley & Co. LLC, BofA Merrill Lynch and Wells Fargo Securities LLC were the active bookrunners. Barclays was a passive bookrunner.

3M is a Maplewood, Minn.-based manufacturer of products including Post-it notes and Scotch Office tape.

JPMorgan sells floaters

JPMorgan Chase Bank priced $1.5 billion of two-year senior floating-rate notes at Libor plus 37 bps on Tuesday, according to a market source.

The notes (Aa2/A+/AA) were initially talked to price in the Libor plus 45 bps area.

J.P. Morgan Securities was the bookrunner.

The banking services company and subsidiary of JPMorgan Chase & Co. is based in Columbus, Ohio.

Bank of New Zealand prices

Bank of New Zealand priced $750 million of 3.5% five-year notes (A1/AA-) on Tuesday at a spread of Treasuries plus 108 bps, according to a market source.

The notes were guided to price with a Treasuries plus 110 bps area spread, plus or minus 2 bps.

Citigroup, JPMorgan, Morgan Stanley and nabSecurities, LLC were the bookrunners.

The bank is based in Auckland, New Zealand.

PNC upsizes add-on

PNC Financial Services Group priced an upsized $300 million add-on to its 3.5% senior notes due Jan. 23, 2024 on Tuesday at a spread of 85 bps over Treasuries, according to a market source and an FWP filing with the Securities and Exchange Commission.

The issue (A3/A-/A+) priced with a yield of 3.34%.

The deal was upsized from $250 million.

PNC Financial Services originally sold $750 million of the notes on Jan. 17 at 99.773 to yield 3.55%, or Treasuries plus 100 bps.

Citigroup and PNC Capital Markets LLC were the bookrunners of the reopening.

PNC Financial Services is a Pittsburgh-based financial services holding company.

Bank of England prices

The Bank of England priced $2 billion of 2.5% notes due Feb. 22, 2022 (Aa2/AA/AA) in a Rule 144A and Regulation S offering on Tuesday at mid-swaps plus 2 bps, or a spread of Treasuries plus 11.95 bps, according to a market source.

Initial price talk was in the mid-swaps plus 5 bps area.

BofA Merrill Lynch, Barclays, Goldman Sachs and JPMorgan Securities were the bookrunners.

London-based Bank of England is the central bank of the United Kingdom.

BNG Bank reopens notes

BNG Bank (Aaa/AAA/AA+) priced an upsized $300 million add-on to its senior floating-rate notes due March 11, 2022 on Tuesday to yield Libor plus 5 bps, according to a market source.

The notes, which have a coupon of Libor plus 7 bps, were initially talked to price with a yield in the Libor plus 5 bps area.

The deal was upsized from $250 million.

Citigroup and Goldman Sachs were the bookrunners of the Rule 144A- and Regulation S-eligible transaction.

BNG Bank originally sold $500 million of the notes on April 5, 2018 at Libor plus 7 bps. The total outstanding is now $1.26 billion.

The banking services company, formerly known as NV Bank Nederlandse Gemeenten, is based in the Hague, the Netherlands.

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