By Cristal Cody
Chicago, July 26 – Capital One Financial Corp. priced $2.25 billion of fixed-to-floating rate senior notes in two parts (Baa1/BBB/A-) on Monday, according to an FWP filing with the Securities and Exchange Commission.
The bank priced $1.35 billion of four-year notes that start with a 4.985% interest rate that converts to a floating rate of SOFR plus 216 basis points in the final year.
The notes priced at par with a spread of 200 bps over Treasuries, tighter than price talk in the 220 bps area, according to a market source.
The notes can be optionally redeemed on the reset date at par.
Capital One also sold $900 million of notes due 2030.
The notes start with a 5.247% coupon that converts to SOFR plus 260 bps on July 26, 2029.
The notes priced at par with a spread of 235 bps over Treasuries versus spread talk in the 255 bps area.
Like the first series, the notes can be redeemed early at par on July 26, 2029, the reset date.
Joint bookrunners are Barclays, BofA Securities Inc., Morgan Stanley & Co. LLC, Wells Fargo Securities LLC and Capital One Securities Inc.
Proceeds will be used for general corporate purposes, which may include debt repayment, common stock or other securities redemptions and repurchases, acquisitions, working capital, capital expenditures and investments.
Capital One is a McLean, Va.-based financial services company.
| Issuer: | Capital One Financial Corp.
|
| Amount: | $2.25 billion
|
| Issue: | Fixed-to-floating rate senior notes
|
| Bookrunners: | Barclays, BofA Securities Inc., Morgan Stanley & Co. LLC, Wells Fargo Securities LLC and Capital One Securities Inc.
|
| Co-managers: | Blaylock Van, LLC, R. Seelaus & Co., LLC, Samuel A. Ramirez & Co., Inc. and Siebert Williams Shank & Co., LLC
|
| Trustee: | Bank of New York Mellon Trust Co., NA
|
| Counsel to issuer: | Davis Polk & Wardwell LLP
|
| Counsel to underwriters: | Mayer Brown LLP
|
| Trade date: | July 25
|
| Settlement date: | July 27
|
| Ratings: | Moody’s: Baa1
|
| S&P: BBB
|
| Fitch: A-
|
| Distribution: | SEC registered
|
|
|
| 2026 notes
|
| Amount: | $1.35 billion
|
| Maturity: | July 24, 2026
|
| Coupon: | 4.985% starting rate; converts to SOFR plus 216 bps starting July 24, 2025
|
| Price: | Par
|
| Yield: | 4.985%
|
| Spread: | Treasuries plus 200 bps
|
| Call features: | At par on July 24, 2025
|
| Price talk: | Treasuries plus 220 bps area
|
| Cusip: | 14040HCU7
|
|
|
| 2030 notes
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| Amount: | $900 million
|
| Maturity: | July 26, 2030
|
| Coupon: | 5.247% starting rate; converts to SOFR plus 260 bps starting July 26, 2029
|
| Price: | Par
|
| Yield: | 5.247%
|
| Spread: | Treasuries plus 235 bps
|
| Call features: | At par on July 26, 2029
|
| Price talk: | Treasuries plus 255 bps area
|
| Cusip: | 14040HCV5
|
|
|
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