Goldman Sachs Sells $2.75 Billion of Bonds Ahead of CPI

(Bloomberg) — Goldman Sachs Group Inc. raised fresh debt in the US investment-grade bond market, the latest issuer to tap investors after Fitch Ratings cut the country’s credit score and ahead of key inflation data later this week.

The bank sold $2.75 billion of bonds in two parts, according to a person familiar with the matter. The $2.25 billion fixed-to-floating rate tranche will yield 1.03 percentage points above Treasuries, after initial price discussions suggested 1.25 points. The bonds are noncallable for two years and mature in three years, said the person, who asked not to be identified as the details are private.

Goldman was among at least nine borrowers to come to market Monday, following the six issuers that sold fresh debt in the days following Fitch’s rating action. Also, borrowers might look to get deals done before the latest reading of the consumer price index — due on Thursday — which is leading the market to weigh a potential pause to rate increases in September.

Read More: US WEEK AHEAD: July CPI to Support Fed Pause in September

Activity in the primary market kicked off with a number of banks announcing debt deals overnight, including BNP Paribas, which became the first European bank to sell additional tier 1 notes in US dollars since the writedown of Credit Suisse securities. AT1 bonds are a kind of hybrid security that helps banks bolster capital to meet regulations designed to prevent a failure.

Read More: BNP Sells Dollar AT1 With New Terms in Wake of Credit Suisse

Thermo Fisher Scientific and Caterpillar Financial are among the issuers in the market Monday, where a combined $14.5 billion is expected to price. Dealers’ estimates for the week call for around $30 billion of new issuance.

Representatives for Goldman Sachs, BNP, Caterpillar Financial and Thermo Fisher declined to comment.

–With assistance from Josyana Joshua.

(Updates to show deal has priced.)

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