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(Bloomberg) — JPMorgan Chase & Co. sold $8 billion of US investment-grade corporate bonds on Tuesday after posting earnings on Friday, setting the stage for a potential flood of issuance from top Wall Street banks.
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The biggest lender in the US by assets sold the bonds in four parts, according to a person with knowledge of the matter. Earlier discussions with investors were for a size between $6 billion and $7 billion, according to separate people familiar with the matter. The bank raked in about $34 billion in orders, allowing it to increase the final deal size.
The longest portion of the offering, an 11-year fixed-to-floating-rate security, yields 0.92 percentage point above Treasuries, after initial discussions of around 1.15 to 1.20 percentage point, one of the people said, declining to be identified discussing private details.
A spokesperson for JPMorgan declined to comment.
The bond sale comes after the bank reported a surprise gain in net interest income for the third quarter and raised its forecast for the key revenue source, even amid expectations that US interest rates will continue to fall.
JPMorgan, along with Goldman Sachs Group Inc., Bank of America Corp. and Citigroup Inc. posted equities and fixed-income trading hauls that surpassed analyst estimates for the three months ended Sept. 30. For each firm’s stock traders, it was the best third-quarter on record.
Top banks on Wall Street could borrow $20 billion to $24 billion after they post results, more than the $15 billion they’ve typically raised in October over the prior decade, JPMorgan credit analyst Kabir Caprihan wrote in a research note last week. The lenders are taking advantage of tight credit spreads and strong demand from investors.
JPMorgan is the sole bookrunner on its bond sale and intends to use the proceeds for general corporate purposes, one of the people familiar said.
(Updates with final pricing details.)
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