Week ends with $7.7 billion issuance, backlog waits for coming week; August sees $33 billion in new issues

By Andrea Heisinger

New York, Aug. 29 - It was both the last day of trading for the week and the month, and both ended with a decidedly quiet tone Friday.

There was little to no action in the new issue market, a source said, adding that that was to be expected before a long weekend.

Asian Development Bank announced terms of its issue from Thursday, adding to the other foreign government-affiliated banks that issued this week.

The week ended with more than $7.7 billion in new issues.

The secondary market saw "very little" action Friday, a source said early afternoon.

Week's total boosted by handful

A small number of issuers raised the amount of issuance for the week to more than $7.7 billion, well over double the previous week's total of about $2.8 billion in new issues.

Issuers for the week included McCormick & Co., Inc., Sierra Pacific Power Co., Province of Ontario, Korea Railroad Corp., European Investment Bank and Toyota Motor Credit Corp.

ADB prices global bonds

The Asian Development Bank priced $1.25 billion in 3.625% five-year global bonds on Thursday, the social and economic financier for the Asia-Pacific countries announced in a press release.

The bonds priced at 99.552 with a spread of Treasuries plus 67.25 basis points.

BNP Paribas Securities, J.P. Morgan Securities Inc. and Nomura ran the books.

The offering is part of $9 billion in debt the bank is issuing in 2008.

Coming week, month seen busier

The pace is expected to quicken in the new issue market in the coming week, and likely much of September, sources said.

A combination of unsavory market conditions and end-of-summer vacations left many issues on the shelf in the latter half of August.

What happens in the coming week depends on market conditions to start the week Tuesday, sources said.

It's unlikely anyone will jump into the market right after the long weekend, a source said.

"It all depends on the needs of the companies going forward," he said. "Some will be able to stand by and look at the market, but it's all on a company need basis."

The market tone was weaker at the close Friday, although how much so was tough to tell with little volume.

"I don't think anything in particular sticks out," a source said. "It's just that any little thing can sway the tone in this environment."

One source said the coming week all comes down to Tuesday.

"It's a call day," he said. "That's the day companies are going to make a call if they're going to issue or not. That means Wednesday could have a lot of issuers, or none at all."

August sees $33 billion issuance

The last trading day of the month ended Friday with $33.572 billion in new issues.

Citigroup Global Markets Inc. claimed the top underwriting spot for the month, handling $6.449 billion in new issues.

The investment bank took over from J.P. Morgan Securities which held the top spot in July.

Year to date, the top underwriter is still J.P. Morgan, with $82.63 billion in new issues.

So far in 2008 there have been $602.572 billion new offerings.

Secondary sees little movement

Sources reported no big movers in the secondary market Friday, with very little volume to work with.

"It's really quiet," a trader said. "Everyone left for the weekend yesterday."

There was no big shift in outstanding bonds from Dell, Inc., the source said, after the computer company's earnings announcement late Thursday.

The company saw its profit fall 17% in the second quarter, with $616 million in income, compared with $746 million in 2007.

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