Published on 8/9/2022 in the Prospect News Green Finance Daily and Prospect News Investment Grade Daily.
New Issue: Wells Fargo prices $2 billion inclusive communities and climate fixed-to-floaters
By Marisa Wong and Cristal Cody
Los Angeles, Aug. 9 – Wells Fargo & Co. priced $2 billion of 4.54% four-year senior redeemable fixed-to-floating rate notes on Monday, according to a 424B2 filing with the Securities and Exchange Commission.
The series U medium-term notes are classified as an inclusive communities and climate bond.
The notes priced at par to yield 4.54%, or a spread of 140 basis points above Treasuries.
Initial price talk was in the Treasuries plus 165 bps area, according to a market source.
The interest rate is fixed at 4.54% until Aug. 15, 2025, when it converts to a floating rate equal to compounded SOFR plus 156 bps, according to the 424B2 filing.
The notes are non-callable for the first year. After that, they feature a make-whole call, followed by a par call.
Wells Fargo Securities, LLC, Academy Securities, Inc., CastleOak Securities, LP, Drexel Hamilton, LLC, R. Seelaus & Co., LLC and Samuel A. Ramirez & Co., Inc. are the joint bookrunners. AmeriVet Securities, Inc., Great Pacific Securities, Loop Capital Markets LLC, Siebert Williams Shank & Co., LLC and Stern Brothers & Co. are the joint lead managers.
Proceeds are earmarked for financing or refinancing loans or investments made by the company to support a combination of climate projects and inclusive communities projects. Inclusive communities and climate projects may include transactions originated or investments committed up to 24 months prior to the issuance of the notes.
The financial services company is based in San Francisco.
| Issuer: | Wells Fargo & Co.
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| Amount: | $2 billion
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| Issue: | Series U medium-term notes, senior redeemable fixed-to-floating rate notes, inclusive communities and climate bond
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| Maturity: | Aug. 15, 2026
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| Joint bookrunners: | Wells Fargo Securities, LLC, Academy Securities, Inc., CastleOak Securities, LP, Drexel Hamilton, LLC, R. Seelaus & Co., LLC and Samuel A. Ramirez & Co., Inc.
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| Joint lead managers: | AmeriVet Securities, Inc., Great Pacific Securities, Loop Capital Markets LLC, Siebert Williams Shank & Co., LLC and Stern Brothers & Co.
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| Co-managers: | American Veterans Group, PBC, Apto Partners, LLC, Bancroft Capital, LLC, Blaylock Van, LLC, Cabrera Capital Markets LLC, C.L. King & Associates, Inc., Guzman & Co., MFR Securities, Inc., Mischler Financial Group, Inc., Multi-Bank Securities, Inc., Penserra Securities LLC, Roberts & Ryan Investments, Inc., Telsey Advisory Group LLC and Tigress Financial Partners LLC
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| Registrar, paying agent: | Computershare Trust Co., NA
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| Coupon: | 4.54% initially; resets on Aug. 15, 2025 to floating rate of compounded SOFR plus 156 bps
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| Price: | Par
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| Yield: | 4.54%
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| Spread: | Treasuries plus 140 bps
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| Call features: | Make-whole call from Aug. 22, 2023 through Aug. 14, 2025, in whole or in part at Treasuries plus 25 bps; par call beginning Aug. 15, 2025, in whole on Aug. 15, 2025 or in whole or in part beginning July 15, 2026
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| Pricing date: | Aug. 8
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| Settlement date: | Aug. 15
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| Price talk: | Treasuries plus 165 bps area
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| Cusip: | 95000U3C5
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