Bank of Montreal, Barclays, FS KKR, Juniper, National Bank, AIG, WSFS price; inflows soften

By Cristal Cody

Tupelo, Miss., Dec. 3 – High-grade supply picked up on Thursday with more than $7 billion of issues sold over the session.

Bank of Montreal (Aa2/A+/AA-) priced $1.5 billion of senior medium-term notes in two tranches.

The deal included $600 million of three-year floating-rate notes and $900 million of three-year fixed-rate notes.

Barclays plc brought $1.5 billion of fixed-rate resetting senior callable notes due Dec. 10, 2024 (Baa2/BBB/A) to the primary market.

FS KKR Capital Corp. (Baa3//BBB-) priced $1 billion of notes due Jan. 15, 2026 in an offering upsized from $400 million.

Juniper Networks, Inc. came by with $800 million of senior notes (Baa2/BBB/) in two tranches following fixed income investor calls in the prior session.

The company sold $400 million of five-year notes and $400 million of 10-year notes.

National Bank of Canada (A3/A/A+) tapped the primary market with $750 million of notes due Nov. 15, 2024.

AIG Global Funding priced $550 million of three-year senior secured notes (A2/A+/) backed by funding agreements during the session.

In addition, WSFS Financial Corp. sold $150 million of 10-year fixed-to-floating rate senior notes (Kroll: A-) on Thursday.

In other financial supply, Citigroup Inc. (A3/BBB+/A) priced $1.5 billion of $25-par fixed-rate reset preferred stock.

Corporate bond volume totals more than $19 billion week to date following $5.5 billion of supply on Monday, $7.35 billion of issuance on Tuesday and just $600 million of offerings on Wednesday. Sovereign, supranational and agency bond supply includes $4.5 billion of notes sold this week.

About $15 billion to $20 billion of corporate supply was expected by market participants for the week.

Credit spreads firm

Meanwhile, high-grade corporate funds inflows slowed this past week.

Investment-grade corporate funds saw $4.81 billion of inflows for the week ended Wednesday, according to Refinitive Lipper US Fund Flows.

In the previous week, inflows totaled $5.94 billion, compared to $4.14 billion in the week prior.

Market tone was positive over the day with stocks mostly stronger ahead of Friday’s release of the Labor Department’s November jobs data.

The iShares iBoxx Investment Grade Corporate Bond ETF improved 0.39% to $137.76.

The PIMCO Investment Grade Corporate Bond index softened 0.01% to $116.78.

The Markit CDX North American Investment Grade 35 index tightened nearly 1 basis point to a spread of 49.39 bps from 50.32 bps on Wednesday.

BNY Mellon improves

In the secondary market, new issues were mixed but mostly trading better this week, a source said.

Bank of New York Mellon Corp.’s $750 million of 0.35% senior medium-term notes due Dec. 7, 2023 (A1/A/AA-) that priced on Monday with one of the tightest spreads of the year continued to firm in secondary trading to 17 bps bid.

The notes priced at a spread of Treasuries plus 20 bps, on the tight side of guidance in the 22 bps spread area and better than initial talk in the Treasuries plus 40 bps spread area.

The deal was upsized from $500 million.

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