Corporate Bond Wrap

February 7th, 2008 1:22 pm | by John Jansen |

Corporate bond issuers had the temerity to offer a chunk of bonds for investor consumption on the same day that the Treasury offered $9 billion 30 year bonds. Some of the corporate issues ,particularly the Verizon deal ,received a far more enthusiatic reception than the Treasury. Alexander Hamilton  is ,I suppose , probably spinning in his grave down at Trinity Church

Verizon offerd $4 billion in three tranches: $750M 5 years; $1500M 10 years; and $1750M 30 years. The issues came about 15 basis points cheap to outstanding paper and were well oversubscribed. The name had been rich to ATT paper but the pricing cheapened VZ relative to ATT. Each tranche drew such strong interest that the underwriters tightened the talk by 7 basis points for the 5year,6 basis points for the 10 year and 10 basis points for the 30 year.

The issues will price at T+ 163 basis points in 5years, 178 basis points in 10 years and 195 basis points in 30 years. Each issue is better bid by 5 basis points or so in the so called gray market.

One portfolio manager with whom I conversed noted that this issue had a salutary effect on other telecom paper and did not have other such paper spilling wider.


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  1. 3 Responses to “Corporate Bond Wrap”

  2. By maureen on Oct 30, 2008 | Reply

    are these bonds for the public to purchase I’m not sure as I just heard the Verizon bond on tv. thank you

  3. By DAVID on Nov 2, 2008 | Reply

    Are these bonds able to be purchased by the public and where??

  4. By DAVID on Nov 2, 2008 | Reply

    Are these Bonds able to be purchased by the general public and where??

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