Supply increases; JPMorgan, Wells Fargo, Citigroup, Citibank tap primary; Toyota prices

By Cristal Cody

Tupelo, Miss., July 16 – Bank and financial issuers priced nearly $14 billion of investment-grade paper on Monday.

JPMorgan Chase & Co. brought $5.5 billion of floating-rate and fixed-to-floating-rate notes in three tranches, upsized from an initial two-part expected offering.

Wells Fargo Bank NA priced a $3.25 billion two-tranche sale of senior bank notes.

Citigroup Inc. came with $2.5 billion of 30-year notes, while Citibank, NA priced $2.5 billion of fixed- and floating-rate notes in two tranches.

JPMorgan Chase, Citigroup Inc. and Wells Fargo & Co. released second earnings results on Friday.

Additional bank and financial issuance is expected over the week.

Bank of America Corp. reported its earnings before the market opened on Monday. Goldman Sachs Group Inc. releases its profit results on Tuesday, while Morgan Stanley will post its quarterly earnings on Wednesday.

In other primary action on Monday, Toyota Motor Credit Corp. priced $700 million of medium-term notes in two tranches.

About $25 billion of overall deal volume is forecast for the week, according to syndicate sources.

The week on average has posted $26 billion of average high-grade bond issuance from 2011 to 2017, according to a BofA Merrill Lynch note released on Monday.

Investment-grade issuers priced more than $10 billion of bonds in the previous week, while no supply came over the July 4 holiday week.

The Markit CDX North American Investment Grade 30 index was mostly unchanged on the day at a spread of 61 basis points.

JPMorgan prints $5.5 billion

JPMorgan Chase priced $5.5 billion of floating-rate and fixed-to-floating-rate notes in three tranches in the offering on Monday, according to a market source.

The $1 billion of six-year floating-rate notes priced at Libor plus 89 bps.

JPMorgan Chase sold $2.25 billion of 3.797% six-year fixed-to-floaters at a spread of Treasuries plus 105 bps. The notes will convert to a floating rate of Libor plus 89 bps after the initial fixed-rate period.

The $2.25 billion tranche of 4.203% 11-year fixed-to-floating-rate notes priced at a Treasuries plus 135 bps spread. The rate will reset to Libor plus 126 bps after the initial fixed-rate period.

J.P. Morgan Securities LLC was the bookrunner.

The financial services company is based in New York.

Wells brings $3.25 billion

Wells Fargo Bank sold $3.25 billion of senior bank notes (Aa2/AA-/AA-) in two tranches during the session, according to a market source.

The bank priced $1.25 billion of floating-rate notes due July 23, 2021 at Libor plus 50 bps.

Wells Fargo Bank sold $2 billion of 3.325% three-year fixed-to-floating-rate notes at a Treasuries plus 73 bps spread. The notes will reset to a floating rate of Libor plus 49 bps after the initial fixed-rate period.

The bookrunner was Wells Fargo Securities LLC.

The bank is a subsidiary of San Francisco-based Wells Fargo & Co.

Citigroup prices $2.5 billion

Citigroup (Baa1/BBB+/A) sold $2.5 billion of 4.65% 30-year notes at a spread of Treasuries plus 170 bps on Monday, according to a market source.

The notes priced on the tight side of initial guidance in the Treasuries plus 185 bps area.

Citigroup Global Markets Inc. was the bookrunner.

Citigroup is a financial services company based in New York.

Citibank sells two tranches

Citibank placed $2.5 billion of fixed- and floating-rate notes (A1/A+/) in two tranches on Monday, a market source said.

The company sold $750 million of three-year floaters at Libor plus 57 bps.

Citibank priced the $1.75 billion of 3.4% three-year fixed-rate notes at a spread of 77 bps over Treasuries.

Citigroup Global Markets was the bookrunner.

Citibank is a Sioux Falls, S.D.-based commercial and consumer banking products and services company.

Toyota places notes

Toyota Motor Credit priced $700 million of medium-term notes (Aa3/AA-/) in two tranches during the session, according to FWP filings with the Securities and Exchange Commission.

The company sold $500 million two-year floaters at par to yield Libor plus 24 bps.

Toyota priced $200 million of two-year fixed-rate notes at par to yield 3.07%.

Morgan Stanley & Co. LLC and RBC Capital Markets, LLC were the bookrunners on the floaters. Morgan Stanley was the bookrunner for the fixed-rate notes.

Toyota Motor Credit is a Torrance, Calif.-based financing arm and subsidiary of Toyota Motor Corp.

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