BP Capital Markets launched a US$2.5bn two-tranche bond on Wednesday for its fourth deal of the year adding to a war chest of cash on hand that it plans to use toward deleveraging.

The British energy company (A1/A-) tightened spreads by 20bp-30bp through price progression to launch a US$1bn 10-year at 120bp over Treasuries and a US$1.5bn 30-year at 155bp over Treasuries.

The two-part senior unsecured deal will be used for general corporate purposes.

Research firm CreditSights said it expects some of the proceeds to be used to repay some US$11bn of short-term debt.

The short term debt includes US$2.85bn in bonds maturing this year and US$4.92bp maturing next year, according to Refinitiv data.

The company has already raised US$9.5bn in the US high-grade primary this year including two notes in the same tenor as Wednesday's offering, according to IFR data.

In February, prior to market volatility from Covid-19, BP priced a US$1.25bn 3% 30-year at...

Metro Bank may look to raise £200m-£300m of MREL-eligible debt in the first half of 2021 subject to a Bank of England review, the UK lender said on Wednesday, flagging it may fall below MREL requirements in the meantime.

Issuing MREL-eligible debt has proved a significant challenge for Metro with its elevated funding costs far above most of its peers'.

The troubled challenger bank succeeded in meeting an interim MREL requirement by a January 1 2020 deadline, but at a high price.

It first tried to issue senior non-preferred debt last September but was forced to pull the deal after being unable to generate sufficient demand, despite offering a coupon of 7.5%.

Metro finally got a £350m deal done in October at an eye-watering level of 9.5%, on the same day its founder and chairman Vernon Hill announced he would step down.

As of the end of the first half of 2020, Metro's total capital ratio plus MREL was 21.3%, compared to the current expected final...

Blackstone and Hudson Pacific Properties are tapping the commercial mortgage-backed securities market to fund a joint venture to operate and develop Hudson's media studio lots and adjacent office towers in Hollywood, California.

The US$855m multi-part offering is backed by a US$900m loan on four office buildings and three studios that total over two million square feet, Moody's said in a pre-sale report on the transaction, GB 2020-FLIX.

The loan has an initial term of two years with three one-year extension options. Its initial interest rate is Libor plus 2.15% per year, Hudson Pacific said last week.

Goldman Sachs and Barclays are joint book managers of deal, which is set to price on Friday.

On June 29, the private equity firm and real-estate investment trust said Blackstone Property Partners will acquire a 49% stake of Hudson's media portfolio properties, while the REIT will retain a 51% interest and oversee operations, leasing and development....

Morgan Stanley has been suspended as a primary dealer in France's sovereign debt market for at least three months by Agence France Tresor.

In the statement, the AFT said it suspended the US bank for the execution on June 16 2015 of transactions that seriously affected the liquidity of the French sovereign bond market, in contradiction with its obligations as Specialist en Valeurs du Tresor (SVT).

It added that the bank's failure to comply with its disclosure obligation under the SVT Charter regarding the existence, as of June 2017, of an investigation by the Authorite des Marches Financiers (AMF) into the transactions was the other reason for the suspension.

The restoration of Morgan Stanley's status as an SVT is subject to compliance with remedial measures jointly adopted with the AFT.

The bank was fined €20m in December 2019 by France's AMF for manipulating the price of 14 French government bonds (OAT) and eight Belgian bonds (OLO) on June 16 2015, and...

Argentina and its creditors have reached an agreement on an over US$65bn bond restructuring, breaking a deadlock between the two groups that has lasted months.

The government said in a statement early Tuesday that it had cut a deal with the three main creditor groups - the Ad Hoc Group of Argentine Bondholders, the Argentina Creditor Committee and the Exchange Bondholder Group - as well as other "significant holders" of its bonds.

As part of the agreement, the sovereign will adjust certain payment dates on the new bonds, without increasing principal and interest payments to "enhance the value of the proposal" for creditors, the government said in a statement Tuesday.

"This agreement will allow the country to sustain high growth, reduce poverty, and enable more Argentines to meet their legitimate aspirations for a better standard of living for their families – all of which are also essential for improving creditworthiness and breaking the cycle of boom-bust...

Norway's Adevinta is preparing the financing for its acquisition of an eBay unit, according to sources, in what could be one of the first M&A deals to hit the market after the summer break.

The financing, which is expected as early as September, is set to be taken out completely in the high-yield market, or split between the high-yield and term loan B market, according to a source familiar with the deal, who said it would be around US$2.6bn in size.

A second source familiar said the size of the financing means it is more likely to be a combination of a term loan B and high-yield bond.

Adevinta has signed an agreement to buy the bulk of eBay's Classifieds Group for around US$9.2bn, backed with a US$3bn secured bridge loan provided by Citigroup, Barclays and DNB.

Another chunky bond financing in the pipeline is the approximately-€1.5bn high-yield component of Spanish telecoms company Masmovil's €2.96bn buyout by KKR, Cinven and...

The IG and HY primaries are on fire this first market day of August, with nine IG offerings expected to price and 10 HY deals announced.

Alphabet leads the investment-grade pack into the market, while high-yield has 10 announced deals, with six expected to price today.

Structured finance is also swelling with offerings at the start of this month.

US stocks are up this morning and Q2 earnings are through the halfway mark.

HIGH GRADE

Alphabet, the parent company of tech giant Google, is in the US high-grade bond market Monday with what could be its largest bond issuance ever, according to IFR data.

The company is shopping a new six-part offering that includes seven, 20 and 40-year tranches that will be used for general corporate purposes, as well as five, 10 and 30-year sustainability bonds.

With initial price thoughts set as low as Treasuries plus 40bp area on the five-year and as high as 125bp-130bp over on the 40-year, Alphabet...

Negative screening has been responsible for shifts in corporate behaviour in the coal sector but there are issues with adopting a one-size-fits-all approach, according to research by Barclays.

While this approach remains the most widely used method for integrating ESG into the investment process, a closer look at coal reveals both drawbacks for the specific sector and also potentially wider issues with its implementation.

"We conclude that corporate and sovereign engagement and positive screening would be more effective at achieving the ultimate aims of reducing pollution from coal-based sources than negative screening," said the report from Barclays.

As the most carbon-intensive fossil fuel, it is not surprising that coal, particularly thermal coal, sits alongside tobacco and weapons manufacturers on negative screening lists.

"Unlike with tobacco or weapons manufacturers, we believe the effectiveness of negative screening of the coal sector at modifying...

Delivery company FedEx is out with its first enhanced equipment trust certificate offering since the 1990s, as it looks to use its planes to secure additional liquidity, one lead banker confirmed.

The structure, which is typically used by airlines, secures the US$690m offering to 14 Boeing aircraft appraised at US$1.3bn, that were delivered new to FedEx between September 2015 and June 2020, according to an investor presentation.

By the time of the expected maturity in February 2034 the aircraft will have a weighted average life of 8.8 years.

FedEx's senior unsecured curve is rated Baa2/BBB, but the secured structure is pushing the EETC offering to Aa3/AA- ratings.

That higher rating allowed bookrunners Citigroup, Deutsche Bank and Morgan Stanley to set price talk at 2%-2.125%.

Comparing yields on EETC transactions is tricky because the pool of assets differ greatly between companies, investors explained. That being said, the notes offered much less...

Credit Suisse’s new chief executive Thomas Gottstein has followed many rivals and is to put back all the Swiss bank’s investment banking activities in one combined unit to be led by head of global markets Brian Chin.

Five years ago, Gottstein’s predecessor Tidjane Thiam had split wholesale banking and capital markets from the secondary markets activities and also created such divisions within its Asia-Pacific business. He had also started a trading division within the core wealth management unit.

Gottstein has decided to simplify the structure, in part to save some SFr400m (US$439m) of overlapping costs but mainly to make the various investment banking parts of the group work more effectively to serve its prime customers: entrepreneurs and other rich individuals from around the world.

“The combination is less driven, frankly, by cost consideration but more by the increased revenue growth opportunities that we see,” he said. Gottstein pointed out that the...

Updates with comments from management

Standard Chartered saw its first-half profit tumble by a third as it increased impairment charges more than sixfold in response to the Covid-19 crisis, with the Anglo-Asian lender warning that income was likely to remain subdued for the rest of the year.

StanChart said today that pre-tax profit for the six months to June 30 came in at US$1.63bn versus US$2.41bn for the same period last year.

This was primarily the result of an increase in credit impairments, which rose to US$1.57bn from US$254m for the first half last year as operating income edged up 3% to US$8.1bn. Expenses also fell, by 10% to US$4.75bn.

The bank struck a cautious note, warning that income was likely to be lower during the second half as low interest rates and less buoyant conditions for the bank's financial markets division due to Covid-19 would weigh on earnings.

StanChart already walked back a number of its medium-term targets at the...

It has become all too clear in recent weeks that because of the Covid-19 pandemic IFR and IFR Asia will not be able to hold our awards dinners on our usual schedule in early 2021. We hope to be able to have events later in the year, if circumstances allow – possibly in May or June. Details of timing and venues are still being finalised; we will update you on this as soon as we are able to.

And that got us thinking. This is a good opportunity to move the “IFR awards year” (currently November 16 to November 15) to an actual calendar year. And to make the timings a little less fraught for everyone by reducing the time pressure.

That means changes to current timelines/deadlines.

This is what we now plan to do.

It has become all too clear in recent weeks that because of the Covid-19 pandemic IFR and IFR Asia will not be able to hold our awards dinners on our usual schedule in early 2021. We hope to be able to have events later in the year, if circumstances allow – possibly in May or June. Details of timing and venues are still being finalised; we will update you on this as soon as we are able to.

And that got us thinking. This is a good opportunity to move the “IFR awards year” (currently November 16 to November 15) to an actual calendar year. And to make the timings a little less fraught for everyone by reducing the time pressure.

That means changes to current timelines/deadlines.

This is what we now plan to do.

Barclays' profit fell sharply last quarter as buoyant trading and underwriting revenues in its investment bank were not enough to offset weakness in consumer banking and a jump in provisions as it braces for higher loan losses coming down the tracks.

Barclays said on Wednesday its corporate and investment bank made a pre-tax profit of £1.04bn in the April-June quarter, up 17% from £887m a year earlier. Revenues increased 19% to £3.32bn. The unit's return on tangible equity was 9.6%, up from 9.2% a year earlier.

That was on the back of strong growth in almost all areas, echoing the theme shown by US rivals during a stunning second quarter thanks to volatile financial markets and as companies rushed to raise debt and equity to shield them from the impact of the coronavirus and lockdown measures.

Barclays' revenues in the second quarter from fixed income, currency and commodities trading was £1.47bn, up 60% from a year earlier. That lagged a 95% rise on average...

(Reuters) - Rolls-Royce is planning a share issue to raise up to 1.5 billion pounds ($1.9 billion) to plug a capital shortfall as a slow recovery in demand for air travel threatens the aviation industry, four sources told Reuters.

The British aerospace engineer is expected to pursue a rights issue with new shares offered to existing investors at a discount to the market price, they said.

The Derby-based business, whose shares have tanked nearly 60% since early March, is in talks with BNP Paribas, Morgan Stanley and Jefferies about the share sale, which could take place in September, two of the sources said.

Rolls-Royce told Reuters it was still reviewing options to strengthen its balance sheet but no decisions had been taken. “Our current financial position and liquidity remain strong,” a spokesman said.

Jefferies, BNP Paribas and Morgan Stanley declined to comment.

Rolls-Royce, which makes engines for the Boeing 787 and Airbus 350, said it would...

LONDON/FRANKFURT (Reuters) - Rolls-Royce (RR.L) is planning a share issue to raise up to 1.5 billion pounds ($1.9 billion) to plug a capital shortfall as a slow recovery in demand for air travel threatens the aviation industry, four sources told Reuters.