BB&T, BNY Mellon, Goldman Sachs tap market; spreads firm; BB&T trades tighter in secondary

By Cristal Cody and Aleesia Forni

Virginia Beach, Jan. 28 - BB&T Corp., Bank of New York Mellon Corp. and Goldman Sachs Group Inc. tapped Tuesday's primary amidst a "cautious tone" to the high-grade market.

Goldman Sachs priced the day's largest deal, selling $3.2 billion of notes in two tranches, a market source said.

The bank priced a $700 million tap of its existing floating-rate notes due 2018 with a coupon of 110 basis points over Libor.

The original $1 billion issue of floating-rate senior notes priced on Nov. 12 at par.

There was also a $2.5 billion tranche of 2.625% notes due 2019 priced at 112.5 bps over Treasuries.

BNY Mellon priced $1.25 billion of senior notes in two tranches during the session.

A $500 million tranche of 2.2% five-year notes sold at 67 bps over Treasuries.

There was also $750 million of 3.65% 10-year notes priced at Treasuries plus 95 bps.

BB&T came to market with a $1.1 billion sale of five-year notes in two tranches on Tuesday, according to a syndicate source.

The bank sold $450 million of five-year floaters at par to yield Libor plus 66 bps.

A $650 million tranche of 2.25% notes due 2019 sold at Treasuries plus 78 bps.

High-grade supply so far this week has reached $9.8 billion and could be on track to reach earlier estimates of $15 billion to $20 billion.

However, one source said he is not expecting a large amount of primary activity on Wednesday, as players will be focused on the wrap-up of the Federal Open Market Committee meeting.

Investment-grade bonds tightened over the day, according to market sources.

The Markit CDX North American Investment Grade series 21 index firmed 3 bps to a spread of 70 bps.

In the secondary market, BB&T's 2.25% notes due 2019 traded about 1 bp tighter, a trader said.

Goldman Sachs' new paper and the Bank of New York Mellon's two-tranche offering were not initially active in aftermarket trading late afternoon.

"Too early," a trader said.

Goldman sells floaters

Goldman Sachs Group sold $3.2 billion of notes (Baa1/A-/A-) on Tuesday in two parts, a market source said.

The sale included a $700 million tap of the bank's existing floating-rate notes due Nov. 15, 2018 with a coupon of 110 bps over Libor at 100.477.

The original $1 billion issue of floating-rate senior notes priced on Nov. 12 at par.

A $2.5 billion tranche of 2.625% notes due 2019 was sold with a spread of 112.5 bps over Treasuries.

Pricing was at 99.684 to yield 2.639%.

The notes priced at the tight end of talk.

Goldman Sachs & Co. is the bookrunner.

The financial services company is based in New York City.

BNY new issue

The Bank of New York Mellon priced $1.25 billion of senior medium-term notes, series G, (A1/A+/AA-) in two tranches, according to two separate FWP filings with the Securities and Exchange Commission.

There was $500 million of 2.2% notes due 2019 priced with a spread of 67 bps over Treasuries.

The notes sold at 99.889 to yield 2.223%.

The bank also issued $750 million of 3.65% 10-year notes priced at 99.635 to yield 3.694%, or Treasuries plus 95 bps.

The joint bookrunners were Citigroup Global Markets Inc., J.P. Morgan Securities LLC, BofA Merrill Lynch and BNY Mellon Capital Markets LLC.

BNY Mellon is a New York-based financial services company.

BB&T two-parter

BB&T sold $1.1 billion five-year notes (A2/A-/A+) in two tranches on Tuesday, according to a syndicate source.

The deal included $450 million of floaters due 2019 priced at par to yield Libor plus 66 bps.

There was also $650 million of 2.25% five-year notes sold with a spread of Treasuries plus 78 bps, or 99.597, to yield 2.336%.

The notes sold at the tight end of talk.

Going out in trading, BB&T's 2.25% notes due 2019 firmed to 77 bps bid, 74 bps offered, a trader said.

Barclays, BB&T Capital Markets and Deutsche Bank Securities Inc. were the joint bookrunners.

Proceeds will be used for general corporate purposes, including the acquisition of companies, repurchase of outstanding common stock, repayment of maturing obligations, refinancing of outstanding debt and extending credit to, or funding investments in, subsidiaries.

The financial services company is based in Winston-Salem, N.C.

Bank/brokerage CDS costs dip

Investment-grade bank and brokerage CDS prices declined, according to a market source.

Bank of America Corp.'s CDS costs firmed 3 bps to 87 bps bid, 90 bps offered. Citigroup Inc.'s CDS costs tightened 4 bps to 88 bps bid, 91 bps offered. JPMorgan Chase & Co.'s CDS costs firmed 3 bps to 73 bps bid, 76 bps offered. Wells Fargo & Co.'s CDS costs declined 2 bps to 43 bps bid, 48 bps offered.

Merrill Lynch's CDS costs firmed 3 bps to 89 bps bid, 93 bps offered. Morgan Stanley's CDS costs tightened 4 bps to 97 bps bid, 102 bps offered. Goldman Sachs Group's CDS firmed 3 bps to 100 bps bid, 105 bps offered.

Paul Deckelman contributed to this review.

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