TD Bank taps market; Rabobank, Caterpillar sell add-ons; AT&T tightens; Cisco unchanged

By Aleesia Forni and Cristal Cody

New York, March 31 – Toronto-Dominion Bank, Rabobank and Caterpillar Financial Services Corp. priced bonds on Thursday in what are expected to be the last deals to trickle into the primary this week.

Closing out the first quarter, TD Bank issued $2.25 billion of five-year notes in fixed- and floating-rate pieces. The fixed-rate piece sold around 13.5 basis points inside the midpoint of initial price thoughts.

Rabobank upsized a tap of its existing five-year bonds to $750 million from $500 million.

Also pricing an add-on during the session, Caterpillar Financial issued $450 million of notes in two parts, at the tight side of guidance.

The three financial new issues push the investment-grade primary’s total to $15.98 billion of new issuance for the “sleepy” week, falling in line with earlier predictions.

Looking ahead, issuers are predicted to stay on the sidelines on Friday, with a wealth of data releases scheduled, including March’s jobs report.

Bonds were mixed going into the release of the March jobs report on Friday.

AT&T Inc.’s 4.125% notes due 2026 traded 4 bps better in the secondary market.

Apple Inc.’s 3.25% notes due 2026 firmed 1 bp on Thursday.

Cisco Systems, Inc.’s 2.95% senior notes due 2026 were unchanged.

The Markit CDX North American Investment Grade index closed 1 bp weaker at a spread of 79 bps.

TD Bank prices

Toronto-Dominion Bank sold a $2.25 billion offering of fixed- and floating-rate senior medium-term notes, series A, (Aa1/AA-/AA-) on Thursday, according to a market source.

There was $1.75 billion of 2.125% five-year notes sold at 99.83 to yield 2.161%, or Treasuries plus 97 bps.

Guidance was in the Treasuries plus 100 bps area, tightened from initial price thoughts in the range of Treasuries plus 110 bps 115 bps.

And $500 million of five-year floaters sold at par to yield Libor plus 100 bps following talk at the Libor equivalent to the fixed-rate piece.

TD Securities, Goldman Sachs & Co., Morgan Stanley & Co. LLC and Wells Fargo Securities LLC are the bookrunners.

The financial services and banking company is based in Toronto.

Rabobank new issue

Rabobank priced a $750 million add-on to its 2.5% bonds (Aa2/A+) due Jan. 19, 2021 at Treasuries plus 110 bps, according to a market source.

Pricing was at 100.84 to yield 2.314%.

The notes inside initial price thoughts set in the Treasuries plus 115 bps to 120 bps range.

BofA Merrill Lynch, Barclays, HSBC Securities and J.P. Morgan Securities LLC were the bookrunners.

The financial services company is based in Utrecht, the Netherlands.

Caterpillar adds-on

Caterpillar Financial sold a $450 million add-on to its existing fixed- and floating-rate senior notes (A2/A/A) due Feb. 23, 2018 on Thursday, according to two separate FWP filings with the Securities and Exchange Commission.

A $325 million tranche of 1.5% notes sold at 100.415 to yield 1.276%. The issue sold at Treasuries plus 53 bps.

The notes came at the tight side of guidance set in the 55 bps area over Treasuries.

The original $450 million issue sold at Treasuries plus 75 bps.

And $300 million of floating-rate notes sold at 100.547 to yield Libor plus 42 bps. The tranche was talked at the Libor equivalent to the fixed-rate tranche.

The notes carry a coupon of Libor plus 70 bps. The original $300 million issue sold at par.

Both tranches sold on Feb. 22.

Bookrunners were BofA Merrill Lynch, Citigroup Global Markets Inc. and Societe Generale.

The funding arm of heavy equipment maker Caterpillar is based in Nashville, Tenn.

AT&T tightens

AT&T’s 4.125% notes due 2026 tightened 4 bps 165 bps bid on Thursday, a market source said.

The company sold $1.75 billion of the notes (Baa1/BBB+/A-) on Jan. 29 at a spread of 220 bps over Treasuries.

AT&T is a Dallas-based telecommunications company.

Apple firms

Apple’s 3.25% bonds due 2026 traded 1 bp better on the day at 99 bps bid, a source said.

The company sold $1.25 billion of the notes in an add-on on March 17 at a spread of Treasuries plus 100 bps.

Apple originally priced $2 billion of the notes on Feb. 16 at 150 bps over Treasuries.

The computer and mobile communications device company is based in Cupertino, Calif.

Cisco unchanged

Cisco Systems’ 2.95% notes due 2026 were unchanged in the secondary market at 72 bps bid, a source said.

The company sold $750 million of the notes (A1/AA-) on Feb. 22 at 120 bps over Treasuries.

San Jose, Calif.-based Cisco produces internet protocol-based networking and other communications and information technology products.

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