Charles Schwab Corp is looking to raise up to $2.5 billion through a debt offering, the brokerage said on Thursday as more companies aim to benefit from investors trying to capitalize on a spike in yields.
The Texas-based company will raise the debt in two parts, via notes due in 2029 and 2034 and will use it for its corporate needs.
If held to maturity, the 2029 notes would yield 205 basis points more than the benchmark, risk-free U.S. 5-year Treasury , while the yield on 2034 notes would be 227 bps above the U.S. 10-year Treasury yield.
The appeal of investment-grade rated corporate bonds has increased amid growing expectations that the Federal Reserve will stick with higher rates for longer.
On Wednesday, Pfizer Inc announced its largest debt offering of $31 billion to fund its proposed acquisition of Seagen Inc.
Schwab’s debt issue comes after the brokerage’s first-quarter profit exceeded market expectations by benefiting from a surge in its interest income and CEO Walter Bettinger saying that its liquidity was strong.
The company’s shares were up 0.3% at $52 in early trading.
BofA Securities, Citigroup, Credit Suisse Securities, Goldman Sachs, J.P. Morgan Securities and Wells Fargo Securities are the joint book-running managers for the offering.
Meanwhile, the U.S. debt ceiling debate in Washington has given investors hope to be cautiously optimistic after President Joe Biden and top U.S. congressional Republican Kevin McCarthy said they were determined to reach a deal.
Source : Reuters
As overt discrimination has receded and human capital gaps have narrowed, economists have increasingly turned…
Across the world, governments have made ambitious climate commitments - but delivery remains uneven. While…
The European Union should act now to head off growing impacts from the Iran conflict…
EU CBAM is nudging trade-exposed partners towards carbon pricing, but spillovers are concentrated in high…
The weak performance of business investment across the OECD since the Global Financial Crisis holds…
The US dollar has dominated the international monetary system since the end of Bretton Woods.…