YTD USD Investment Grade Issuance=$500bil+; FOMC Talking Points; Mischler Comment
May 4, 2017   //   by Mischler MarCom   //   Debt Market Commentary  

Quigley’s Corner 05.03.17-YTD USD IG DCM-$500bil+ Issued; FOMC Talking Points: Rates Unchanged


Investment Grade New Issue Re-Cap – What FOMC Meeting? YTD IG Corporate Issuance Passes $500b Mark

Today’s IG Primary & Secondary Market Talking Points

IG Syndicate IG Corporate-only Volume Estimates This Week and April

Global Market Recap

FOMC Statement Key Talking Points – Unanimous Vote to Leave Rates Unchanged

Citigroup, Inc. $250mm (tap) 4.125% Sub Notes due 7/25/2028 Deal Dashboard

NICs, Bid-to-Covers, Tenors, Sizes and Average Spread Compression from IPTs thru Launches

New Issues Priced

Indexes and New Issue Volume

Lipper Report/Fund Flows – Week ending April 26th         

IG Credit Spreads by Rating

IG Credit Spreads by Industry

New Issue Pipeline

M&A Pipeline

Economic Data Releases

Rates Trading Lab

Tomorrow’s Calendar


Oh my.  I have to admit that even I was surprised by the amount of IG Corporate new issues that priced in today’s FOMC Rate Decision Day session.  This might well have been the busiest (or one of the busiest) FOMC Rate Decision sessions for issuance as far back as I can remember.  The IG dollar DCM featured 8 issuers across 8 tranches (Citigroup, Inc. and Citigroup, N.A. are two separate issuing entities), totaling $6.864b.  KBN tapped a 3-year FRN bringing the all-in IG day totals to 9 issuers, 9 tranches and $7.364b.

50% of today’s IG Corporate deals upsized at the tightest side of guidance with one transaction, for ACWA Power, launching 5 bps tighter than the tightest side of guidance. So, all-in-all a very nice day that speaks volumes about what to expect in our IG dollar DCM in May, apparently motivated by strong corporate earnings.

As a result,

  • Today, we officially passed the $500b mark for YTD IG Corporate issuance. We currently stand at $504.804b.
  • The IG Corporate WTD total is now 97.58% of this week’s syndicate midpoint average forecast or $27.899b vs. $28.58b.
  • MTD we’ve now priced nearly 22.60% of the IG Corporate mid-range syndicate projection for April or $27.899b vs. $123.42b.
  • There are now 5 IG Yankee and/or SSA new issues in the IG credit pipeline.


Today’s IG Primary & Secondary Market Talking Points


  • Guardian Life Global Funding upsized its 144a/REGS 5-year FA-backed Notes new issue to $400mm from $300mm at the launch and at the tightest side of guidance.
    AvalonBay Communities Inc.
    bumped up its 10-year Senior Notes new issue today to $400mm from $300mm at the launch and at the tightest side of guidance.
  • ACWA Power Management and Investments One Limited increased its 144a/REGS Senior Secured Bond new issue today to $814mm from a minimum of $600mm at the launch and 5bps tighter than the tightest side of guidance.
  • Kommunalbanken or “KBN” upsized today’s tap of its outstanding FRNs due 6/16/2020 to $500mm from $300mm at the launch and at the tightest side of guidance.  The new outstanding amount is $1.8b.
  • The average spread compression from IPTs and/or guidance thru the launch/final pricing of today’s 8 IG Corporate-only new issues was <17.41> bps.
  • BAML’s IG Master Index tightened 1 bp tp +122 vs. +123.  +106 represents the post-Crisis low dating back to July 2007.
  • Bloomberg/Barclays US IG Corporate Bond Index OAS was unchanged at 1.16.
  • Standard & Poor’s Investment Grade Composite Spread was unchanged at +164.  The +140 reached on July 30th 2014 represents the post-Crisis low.
  • Investment grade corporate bond trading posted a final Trace count of $18.2b on Tuesday versus $12b on Monday and $19.9b the previous Tuesday.
  • The 10-DMA stands at $16.7b.


Global Market Recap


  • U.S. Treasuries – Closed down except the 30yr as the Ultra-Long Bonds got a poor review.
  • Overseas Bonds – Bunds & Gilts unchanged to small gains. Peripheral bonds rallied.
  • Stocks – NASDAQ running out of steam?
  • Overseas Stocks – China closed down. Europe had more green than red.
  • Economic – U.S. data was good across the board (ADP, ISM non-manufacturing, etc.)
  • Overseas Economic – Positive data released in Europe.
  • Currencies – USD better vs. the Yen, Euro & Pound. Big gain for the AUD.
  • Commodities – The metals were led lower by copper which was hit very hard.
  • CDX IG: -0.04 to 62.84
  • CDX HY: +1.30 to 324.76
  • CDX EM: +1.52 to 191.76

*CDX levels are as of 3:30PM ET today.

-Tony Farren


Syndicate IG Corporate-only Volume Estimates This Week and April


IG Corporate New Issuance This Week
vs. Current
WTD – $27.889b
May 2017
vs. Current
MTD – $27.889b
Low-End Avg. $27.96b 99.75% $122.27b 22.81%
Midpoint Avg. $28.58b 97.58% $123.42b 22.60%
High-End Avg. $29.21b 95.48% $124.56b 22.39%
The Low $20b 139.45% $100b 27.889%
The High $36b 77.47% $150b 18.59%


FOMC Statement Key Talking Points – Unanimous Vote to Leave Rates Unchanged


  • The Fed left rates unchanged and in the 0.75% to 1% target range.
  • Repeats it expects the economy to warrant gradual rate hikes.
  • Says the growth slowdown in Q1 ’17 is likely to be transitory.
  • Fed: “fundamentals underpinning consumption growth stayed solid.”
  • Reiterates that “risks to outlook appear roughly balanced.”
  • Core inflation continued to run somewhat below 2%.
  • 12-month inflation is running close to its 2% goal.
  • The labor market continued to strengthen despite slower growth.
  • The Fed noted that job gains were solid, while household spending rose only modestly.
  • Sighted that business investment firmed.
  • Repeated its maintaining balance-sheet reinvestment strategy.
  • The Fed said today’s FOMC vote was unanimous.


Below please find my synopsis of everything Syndicate and Secondary from today’s debt capital markets, including the investment grade corporate bond data drill down as seen from my seat here in Syndicate, Sales and DCM.

Ron Quigley, Managing Director and Head of Fixed Income Syndicate


Citigroup, Inc. $250mm (tap) 4.125% Sub Notes due 7/25/2028 Deal Dashboard

…and the Citigroup Legend Who Wore a Propeller Beanie Cap
Today’s Citigroup tap comes exactly one week after Citigroup’s always formidable 13th Annual Diverse Broker Dealer breakfast, so, there was an extra feel good behind today’s opportunity.

My affiliation covering Citigroup began with the legendary Dr. Charles “Chuck” E. Wainhouse, Citigroup’s former long-time Global Head of Capital Markets and Treasury, when I scheduled a meeting with him when I was at BNP Paribas Syndicate back in 2000 and later again in 2004,  when I first entered diversity & inclusion space. In our meeting, Chuck wore a colorful propeller beanie cap while sitting at the head of a long intimidating conference room table.  If you find that a bit odd, so did I at first, until I quickly learned that as fun a guy as Chuck was, he knew how to take the edge off things, but first and foremost he was clearly a most formidable and brilliant mind.  There are a lot of takeaways there folks.  He was one of our industry legends for sure.

Years ago, as I familiarized myself with the D&I broker dealer space working toward a value-added proposition, I was simultaneously disappointed by limited commitments across-the-sell-side to build respective D&I platforms meaningfully and sustainably……words I often use here in the “QC.” It seemed many on Wall Street focused too much on merely a “check-the-box” mandate in exchange for a “check-in-the-mail.”  Those who advanced the proposition did so with an overwhelming lack of delivery and execution across myriad promises of a value-added proposition. But I persevered when given the opportunity, and I chipped away at delivering meaningful distribution, daily capital markets coverage (the “QC” in its various iterations over the years) conferences, panels, etcetera.  Then one day that experience all culminated when the stars aligned and I found Mischler and Mischler found me. An intensive four-month vetting process ensued.  I concluded that the executive leadership here at Team Mischler was aggressively committed to same ethos I was working to promote and deliver;  a relentlessly consistent value-added proposition each and every day.  That IS the way it IS here and it’s the only way to do it right.

For each rung that I climbed on the diversity broker dealer ladder, Chuck Wainhouse was always there to welcome me and the new team I was aligned with.  He’d say, “Quigley, you’re like your brother….. You guys never give up and you’re always stubborn about doing it right.  Good for you. I respect that. We need more people like you doing it right! It’s a great mandate!”  He placed me on speaker phone on one occasion and asked his Admin to “bring over my appointment book……. I’m scheduling Quigley to come in and see me with his new team. This guy does a great job!” The takeaway is simple – I have fond memories in my dealings with Citigroup over the years.  So started my single longest relationship in the Debt Capital Markets – Citigroup is a keystone to our platform and cornerstone to any serious and successful D&I broker dealer.

So, admittedly this is a bit of a reminiscence here today folks given the quick relative value study on today’s $250mm tap but I thought perhaps a story you might enjoy.

Ending today’s piece where it began, it’s great to know that every year the family that is known as Team Citi makes themselves available for a highly meaningful Annual Diverse Broker Dealer Breakfast, followed by a formidable fixed income, equity and municipal presentation with Q&A followed by great social time with some of the best talent in our business.  All for a wonderful cause – encouraging and rewarding a value-added all-inclusive proposition with the best firms in the business.

Congrats to everyone at team Citi Treasury/Funding, Origination and Syndicate.
Have a look at the Deal Dashboard:


Trading at
the Break
4.125% ‘28 +low 190s
+186 the # +186 +186 <6.5> bps 0/flat 184/182 <2>


Investors showed up in a big way on FOMC Rate Decision day contributing to build a highly impressive $1.1 billion order book making today’s $250mm tap 4.4-times oversubscribed. It is not often one sees a big FIG bid-to-cover rate beginning with a “4” handle.  Well done!


………and here’s a look at final book sizes and oversubscription rates:


CITI (tap) Size Final Book
4.125% ‘28 $250mm $1,100mm 4.4x


Final Pricing – Citigroup, Inc.(tap) 4.125% Sub Notes due 7/25/2028
C $250mm 4.125% Sub. Notes due 7/25/2028 @ $99.559 to yield 4.174% or T+186
New Total Deal Size: $1.75b

Above is the opening extract from Quigley’s Corner aka “QC”  Wednesday May 03 2017 edition distributed via email to institutional investment managers and Fortune Treasury clients of Mischler Financial Group, the investment industry’s oldest minority broker-dealer owned and operated by Service-Disabled Veterans.

Cited by Wall Street Letter in each of 2014, 2015 and 2016 for “Best Research / Broker-Dealer”, the QC observations is one of three distinctive research content pieces produced by Mischler Financial Group. The QC is a daily synopsis of everything Syndicate and Secondary as seen from the perch of our fixed income trading and debt capital markets desk and includes a comprehensive “deep dive” with optics on the day’s investment grade corporate debt new issuance and secondary market data encompassing among other items, comparables, investment grade credit spreads, new issue activity, secondary market most active issues, and upcoming pipeline.

To receive Quigley’s Corner, please email: or via phone 203.276.6646

*Sources: Bank of America/Merrill Lynch, Bloomberg, Bond Radar, Dow Jones Newswire, IFR, Informa Global Markets, Internal Mischler, LCDNews, Market News International, Prospect News, Standard & Poor’s Ratings Services, S, Thomson Reuters and of course, a career of sources, contacts, movers and shakers from syndicate desks to accounts; from issuers to originators; from academicians to heads of research, and a host of financial journalists, et al.

Mischler Financial Group’s “U.S. Syndicate Closing Commentary”  is produced daily by Mischler Financial Group. No part of this document may be reproduced in any manner without the permission of Mischler Financial Group. Although the statements of fact have been obtained from and are based upon sources Mischler Financial Group believes reliable, we do not guarantee their accuracy, and any such information may be incomplete.  All opinions and estimates included in this report are subject to change without notice.  This report is for informational purposes and is not intended as an offer or solicitation with respect to the purchase or sale of any security.   Veteran-owned broker-dealer Mischler Financial Group, its affiliates and their respective officers, directors, partners and employees, including persons involved in the preparation of this report, may from time to time maintain a long or short position in, or purchase or sell a position in, hold or act as market-makers or advisors or brokers in relation to the securities (or related securities, financial products, options, warrants, rights, or derivatives), of companies mentioned in this report or be represented on the board of such companies. Neither Mischler Financial Group nor any officer or employee of Mischler Financial Group or any affiliate thereof accepts any liability whatsoever for any direct, indirect or consequential damages or losses arising from any use of this report or its contents.

YTD USD Investment Grade Issuance=$500bil+; FOMC Talking Points; Mischler Comment