compared to what’s available anywhere else,
as long as they’re not too aggressive on
BRINGINGûTHISûDEALûINûFROMû)04S vûSAIDû3TEVEû
(USSEY ûHEADûOFûlNANCIALûINSTITUTIONSûCREDITû
research at AllianceBernstein.
After snapping tighter earlier in the year,
UK sterling AT1 has been caught in the
"REXITûCROSSHAIRSû!ûaMûPERPETUALûNON
CALLû3EPTEMBERûûFORû#OVENTRYû"UILDINGû
Society was bid as high as 6.89% at the end of
-AY ûTHOUGHûHADûSINCEûRECOVEREDûTOû û
according to Tradeweb data.
"ARCLAYSûPAPERûALSOûSUFFERED ûITSûaBNû
ûHITTINGûûATûTHEûENDûOFû-AY ûALBEITû
STILLûSOMEûWAYûINSIDEûTHEûûYEAR
HIGHû
from early January. It was bid at 6.35% last
Thursday.
Bankers and investors put the initial
concession for the new deal as wide as
87.5bp, although a banker close to the trade
reckoned it was tighter at 75bp, adding that
there was little price sensitivity in the book.
!TûTHEûlNALûûPRICE ûTHEûCONCESSIONûHADû
been cut to a mere 25bp.
This was partly helped by the overall lack
OFûSTERLINGû!4ûSUPPLYû/NLYûaMûHASû
PRINTEDûYEAR
TO
DATE ûVERSUSûõBNûINûTHEû
SINGLEûCURRENCYûANDû53BNûINûDOLLARS û
ACCORDINGûTOû)&2ûDATA
Added to this, Hussey estimated that
BETWEENûaBNûANDûaBNûOFû!4ûISûEXPECTEDû
to leave the market this year as issuers call
deals.
4HEûTRANSACTIONûWASûTHEûlRSTû!4ûFROMûAû
pure bank issuer since a €300m trade from
"ANCOû"0-ûONû!PRILû
The deal has reassured investors that the
BANKûWILLûNOWûLIKELYûTAKEûOUTûTHEûaBN
equivalent of AT1 it has coming up for call
in September across euros, sterling and US
dollars.
It has already issued a US$2bn AT1 earlier
this year.
“If these three bonds were called without
any new AT1 being issued, Barclays would
STILLûHAVEûENOUGHûCAPITAL vûSAIDû%OINû7ALSH û
partner and portfolio manager at
4WENTY&OURû!SSETû-ANAGEMENT
He said Barclays’ ratio of AT1 to risk-
weighted assets would fall below 3.1% if it
called the bonds in September without
issuing more.
“This new issue should give investors
greater comfort that Barclays will now
exercise the call in September,” he said.
By issuing in sterling, Barclays has steered
clear of any volatility associated with raising
AT1 in foreign currency.
h7EûDEBATEDûBETWEENûEUROS ûSTERLINGûANDû
US dollars,” the banker close to the deal said.
h7HENEVERûWEûHAVEûTHATûDEBATEûANDûFEELû
that sterling is open at an amenable level,
then we’ll hit sterling so we have as much
STERLINGû!4ûASûWEûCANû7EûEQUITY
ACCOUNTû
our AT1, so if we don’t issue in sterling there
CANûBEûANû&8ûMISMATCHûWHICHûCANûLEADûTOû
volatility in our capital as currencies move
around.”SWISS FRANCS
NAB TAPS SWISS MARKETNATIONAL AUSTRALIA BANKû!A!!n!!n ûRAISEDû
3&RMû53M ûFROMûLASTû-ONDAYSû
0.125% eight-year senior unsecured bond
offering, which was priced in line with mid-
SWAPSûPLUSûBPûAREAûGUIDANCEûFORûAûZEROû
new issue concession.
Credit Suisse and UBS were joint lead
managers.
&IFTY
lVEû3WISSûINVESTORSûBOUGHTûTHEû
bonds, with asset managers allotted 62.5%,
insurance companies 17.5%, pension funds
9%, private banks 8.5% and bank treasuries
2.5%.
The previous Australian major bank to
ACCESSûTHEû3WISSûMARKETûWASû7ESTPAC û
WHICHûSOLDûAû3&RMûEIGHT
YEARûCOVEREDû
bond issue on January 9 at mid-swaps plus
12bp.ISLANDSBANKI ON SWISS ROADSHOWISLANDSBANKI has appointed UBS to lead a
ROADSHOWûINû:URICHûONû7EDNESDAY
Any deal would be the bank’s debut in the
CURRENCY ûACCORDINGûTOû2ElNITIVûDATA ûANDû
WOULDûINCREASEûTHEûDIVERSIlCATIONûOFûITSûCASHû
raising avenues away from domestic
deposits and wholesale funding.
)SLANDSBANKIûISûRATEDû""" ûBYû30ûONûAû
senior basis.HIGH-YIELD
UNITED STATES
MULTI-COLOR READIES US$2.6bn
FUNDING FOR PLATINUM PURCHASELabel maker MULTI-COLOR is readying pricing
on a dual-tranche junk bond offering as part
of an approximately US$2.60bn package to
FUNDûITSûACQUISITIONûBYû0LATINUMû%QUITYû
0ARTNERS
The deal comes on the back of the latest
BOUTûOFûVOLATILITYûFOLLOWINGû53û0RESIDENTû
$ONALDû4RUMPSûTHREATSûLASTûWEEKûTOûSLAPû
TARIFFSûONû-EXICANûIMPORTSû
ûAûMOVEûTHATû
heightened fears about a downturn in global
growth.
And while markets rebounded on Tuesday
amid hopes of rate cuts in the US,
uncertainty over a multitude of trade battlesstill looms large and has resulted in spread
widening of late.
Even so, investors say technicals for the
asset class remain strong and that money is
there to put to work, albeit on a more
discerning basis.
h7EûDONTûSEEûAûLOTûOFûFORCEDûSELLINGûTOû
meet redemptions and prices haven’t moved
that much,” said an investor.
-ULTI
#OLOR ûWHICHûMAKESûLABELSûFORû
packaging, has announced a US$650m
SEVEN
YEARûSECUREDûNOTEû"" ûANDûAû
53MûEIGHT
YEARûUNSECUREDûTRANCHEû
#AA"
ûWITHûWHISPERSûSETûINûTHEûLOWûû
and low 9% area, respectively.
Lead-left Bank of America Merrill Lynch was
also offering price guidance of Libor plus
BP
BPûONûAû53MûSEVEN
YEARûTERMû
LOANûWITHûAûûmOORûONûTHEûBENCHMARKû)TûISû
also out with the same spreads over Euribor
ONûANûEQUALLYûSIZEDûEUROûTRANCHE
The deal follows closely on the heels of a
53BNûTWO
PARTûBONDûFROMû"ERRYû'LOBALû
last month to fund its acquisition of UK
PACKAGINGûCOMPANYû20#
7HILEû"ERRYûDOWNSIZEDûITSûBONDûTOûRAISEû
more through the term loan in an effort
extract cheaper costs, it remains unclear
WHATûBALANCEû-ULTI
#OLORûWILLûULTIMATELYû
strike between bonds and loans.
“It is all subject to the demand between
the loans and bonds,” said a second
investor.
"ERRYSûlRSTûLIENûSENIORûSECUREDûSEVEN
YEARû
NON
CALLûTHREEûBOND ûRATEDû"A"""
ûHASû
BEENûTRADINGûAROUNDûPARûTOûYIELDû û
ESSENTIALLYûWHEREûITûPRICEDûONû-AYû û
ACCORDINGûTOû-ARKET!XESSûDATA
But its second lien eight-year non call
THREE ûRATEDû""" ûHASûPERFORMEDûBETTERûANDû
was trading at 101.56 with a yield of 5.27%,
up a point and a half since pricing.
Under the terms of the acquisition by
PRIVATEûEQUITYûlRMû0LATINUMû%QUITY û-ULTI
Color shareholders will receive US$50 in
cash for each share of common stock.
The transaction has been valued at
US$2.5bn, including the assumption of
US$1.5bn in debt, and upon completion
-ULTI
#OLORûWILLûBECOMEûAûPRIVATELYûHELDû
company.
Investors have expressed concerns about
-ULTI
#OLORSûLEVERAGEû
ûûTIMESûONûAûNETû
BASISû
ûAFTERûITûBOUGHTû#ONSTANTIAû&LEXIBLESû
labels division in 2017 in a transaction
valued at US$1.3bn-equivalent.
0LATINUMûISûLOOKINGûTOûCOMBINEû-ULTI
#OLORûWITHûITSûPORTFOLIOûCOMPANYû73û
0ACKAGINGû'ROUP ûAûMOVEûTHATûCOULDûBRINGû
SIGNIlCANTûSYNERGIESûGIVENûTHEûOVERLAPûINû
business lines.
h-ULTI
#OLORûISNTûANûOVERWHELMINGû
business and it isn’t something the market
will gobble up, so it will take a bit more
coupon,” said a third investor.BONDS HIGH-YIELD