Magazine article American Banker

PNC Issue Breaks 7% Barrier

Magazine article American Banker

PNC Issue Breaks 7% Barrier

Article excerpt

PNC Funding Corp. raised $200 million in subordinated debt Tuesday at just under 7%, the lowest rate in almost a year.

The PNC Financial Corp. unit issued 10-year subordinated notes to yield 6.998%, the lowest yield for bank subordinated debt since March, according to Securities Data Co.

Bank treasurers have seen good conditions for issuing debt since the end of 1992, as improvements in credit quality, capital levels, and earnings have made banks more popular among investors.

Investors have accepted tighter yield spreads to Treasuries than in the past while the yields on underlying Treasuries have been falling.

The 6.998% yield PNC Funding paid was a tight 66.5 basis points over the underlying 10-year Treasury note.

The spread was 23.5 basis points tighter than the secondary market level of PNC Financial Corp. subordinated debt on Dec. 29, according to First Boston Corp.

Attracted by Low Rates

The issue will likely be used to refund $200 million of senior debt that PNC will probably call next month, a market source said. …

Search by... Author
Show... All Results Primary Sources Peer-reviewed

Oops!

An unknown error has occurred. Please click the button below to reload the page. If the problem persists, please try again in a little while.