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US IG CLOSE-One high-grade borrower taps market for US$1.25bn
(Corrects official RBS (LSE: RBS.L - news) pricing after second revision by bank)
By Mike Gambale
NEW YORK, Aug 5 (IFR) - Below is a recap of primary issuance activity in the US high-grade market on Wednesday:
Number of deals priced: 1
Total (Swiss: FP.SW - news) issuance volume: US$1.25bn
Average book to cover: 2.16
Citigroup Inc, Ba2/BB+/BB+, announced a US$ benchmark SEC registered US$1000 par perpetual fixed/floating rate NC5yr noncumulative preferred stock. Citigroup is sole books on the deal.
UOP: general corporate purposes, which may include: funding the business of its operating units; funding investments in, or extensions of credit or capital contributions to, its subsidiaries; financing possible acquisitions or business expansion; and lengthening the average maturity of liabilities, which means that it could reduce its short-term liabilities or refund maturing indebtedness. Settle: 8/12/2015.
IPT: 6.125% area
PRICE GUIDANCE: 6% area +/- 5bp
LAUNCH: US$1.25bn at 5.95%
PRICED: US$1.25bn. Cpn 5.95%. Issue price par. Yld 5.95%. Back end spread T+409.5bp. First (Other OTC: FSTC - news) pay 2/15/2016. Settlement date 8/12/2015. Cusip # 172967JZ5.
BOOK: US$2.7bn
COMPS:
C 5.875% March 2020 call L+406 back end at 5.625% (YTC)
NOT COUNTABLE
RBS
The Royal Bank of Scotland Group plc, exp B/BB-, announced a US$ benchmark perpetual subordinated contingent convertible Additional Tier 1 capital notes that consists of a non-call five-year (8/10/2020) and non-call 10-year (8/10/2025).
The bonds will convert into equity if the bank's CET1 ratio drops below 7%. RBS, which met investors in the US and London earlier this week, is running its own deal as global coordinator and structuring adviser. Bank of America Merrill Lynch, Credit Suisse and Morgan Stanley (Xetra: 885836 - news) are joint leads for the trade. Settle: 8/10/2015
IPTs: NC5 7.75% area, NC10 8.25% area
GUIDANCE: NC5 7.625% area, NC10 8.125% area
LAUNCH: US$3.15bn total. US$2bn NC5 at 7.5%, US$1.15bn NC10 at 8.0%
PRICED: US$3.15bn total. First pay 9/30/2015.
- US$2bn. Perpetual NC5 at 7.50%. Issue price par. First call 8/1/20. + 593bp vs. 5-year UST. M/S+580bp. Cusip # 780099CJ4.
- US$1.15bn. Perpetual NC10 at 8.00%. Issue price par. First call 8/1/25. +581bp vs. 10-year UST. M/S+572bp. Cusip # 780099CK1.
BOOKS: Total books US$22bn. US$12bn on NC5; US$10bn on NC10 (Reporting by Michael Gambale; Editing by Natalie Harrison)
