Royal Bank of Scotland sells $1.5 billion; credit spreads tighten; financial paper mixed

By Aleesia Forni and Cristal Cody

New York, March 30 – Royal Bank of Scotland Group plc entered Wednesday’s primary market following a dovish speech from Federal Reserve chair Janet Yellen on Tuesday.

The $1.5 billion issue of 10-year senior notes sold around 20 basis points inside initial price thoughts at a final spread of Treasuries plus 300 bps, garnering an order book that was more than two times oversubscribed.

The day’s lone deal continues what has been a mostly slow week for the high-grade primary market, with issuers keeping to the sidelines for the most part ahead of Friday’s all-important payrolls data release.

The week that will close out the month of March has hosted around $12.53 billion of new investment-grade issuance thus far. This figure is just shy of what was predicted to be around a $15 billion to $20 billion week.

Investment-grade credit spreads tightened over the session. The Markit CDX North American Investment Grade index closed 5 bps tighter at a spread of 78 bps.

In the secondary market, Goldman Sachs Group Inc.’s 3.75% senior notes due 2026 firmed 3 bps.

Mitsubishi UFJ Financial Group, Inc.’s new 3.85% senior notes due 2026 headed out flat.

Morgan Stanley’s 3.875% senior notes due 2026 eased 2 bps over the day.

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