Commentary & Deal Flow

CFR CREDIT CLOSE: RABOBK Gets 2022-2025 3yr Bank Spread; Week Still One Of ‘25s Smallest

Following Wednesday’s goose, today rallied today with 3 deals for $1.900bn. This puts the final total for the week at 10 deals/$13.650bn - still one of this year's smallest. Rabobank ended the week with a bang – pricing its 3yr at T+35bp, the lowest 3yr bank spread looking back through 2022.

The final 10 deals/$13.650bn still ranks pretty high on the Smallest Weeks of The Year Lists – but what can you do in a government shut down/blackout week.

The $13.650bn final total lands No. 6 on the Smallest Weeks 2025 (Volume) List:

   The 10 deal final total lands No. 5 on the Small Weeks 2025 (Deals) List – counting ties a 1 place.

    All that said, Rabobank cleared a great level on its 3yr today. The T+35bp landing level is the smallest bank spread looking back through 2022.

    RABOBK's T+35 spread was good enough to beat out RABOBK on 1/5/22 for the lowest 3yr bank spread through 2022:

Turning to its 3.957% coupon, it comes as just the third 3yr to come in below 4.000% in 2025 and ranks back through 2023 as well:

HERE'S TODAY'S RUNDOWN:

[RABOBANK] 

Cooperatieve Rabobank UA/NY (RABOBK) exp Aa2/A+/AA- US$1bn 3(a)2 exempt 2-part Senior Preferred (3y fixed and/or floating due 10/17/28). Barc/BNP/BofA/JPM/Rabo/WFS joint active books. Denoms: 250,000 x 1,000. Governing Law: New York. Sale into Canada: Yes - Exemption. UOP: gcp. Pricing 10/9. Settle 10/17 (T+5). CUSIP: 3y FRN: 21688ABQ4, 3y FXD: 21688ABP6. ISIN: 3y FRN: US21688ABQ40, 3y FXD: US21688ABP66. 

VIA Barc/BNP/BofA/JPM/Rabo/WFS joint active books.

Announced with benchmark size, we heard initial thoughts as T+55-60bp/Seqv. 

Went straight to launch at $500m 3y FRN at SOFR+59. $500m 3y FXD at T+35.

Ultimately, a $1bn deal priced as follows:

$500m 10/17/28 FRN at SOFR+59, at 100.

$500m 3.957% 10/17/28 100.00 3.957% T+35.

As for r/v, outstanding RABOBK was quoted as follows:

RABOBK 4.372% due 05/27/27 T+27bp (G25; $100.79) - $500m pxd 5/19/25 +40
RABOBK 4.883% due 01/21/28 T+26bp (G27; $102.18) - $700m pxd 1/13/25 +40
RABOBK 4.494% due 10/17/29 T+28bp (G34; $101.75) - $750m pxd OCT 2024

Comps away:

Aussie 3yr/5yr comps:

National Australia Bank/NY (Aa2/AA-)
  - NAB 4.308% due 06/13/28 T+31bp (G31; $100.97) - $750m pxd 6/3/25 +40

Australia & NZ Banking Group NY (Aa2/AA-/AA-)
  - ANZ 4.362% due 06/18/28 T+32bp (G32; $101.09) - $500m pxd 6/10/25 +38

Commonwealth Bank of Australia (Aa2/AA-/AA-)
  - CBAAU 4.150% due 10/01/30 T+41bp (G41; $100.03) - $750m pxd 9/22/25 +45

Scandinavian 3yr Sr Pfd Comps:

Nordea Bank (Aa3/AA-/AA)
- NDAFH 4.375% due 03/17/28 T+30bp (G31; $101.08) - $600m pxd 3/11/25 +50

Svenska Handelsbanken (Aa2/AA-/AA+)
- SHBASS 4.375% due 05/23/28 T+35bp (G35; $101.02) - $750m pxd 5/19/25 +50

Skandinaviska Enskilda Banken (Aa3/A+/AA)
- SEB 4.375% due 06/02/28 T+36bp (G36; $101.02) - $750m pxd 05/22/25 +50

*** RABOBK Jan 28s G27;  RABOBK ‘29s G34;  Today’s 10/17/28 maturity would land around with f/v around T+30bp.

Scandinavian banks  NDAFH, SHBASS and SEB (144a/non-index eligible) trading in a G31-36 range in 3yrs (34 mid). RABOK is 3a2 index eligible so should trade inside. So call RABOBK f/v 32 vs Scandis. 

Meanwhile, Aussie June 3yr paper (NAB/ANZ) was trading T+31-32. Maybe call that 33-34 with a bit of curve. The most recent Aussie trade was a 5yr from CBAAU which was to G41; minus 5-10bp 3s/5s = T+34bp. 

Averaging out the three f/v scenarios above:
Vs RABOBK directs (T+30); 
Vs Scandis 3yr f/v T+34 pointing to f/v RABO f/v around T+32 f/v;
Vs Aussies pointing to f/v of around T+34
Average puts f/v at T+32bp.  At the T+35bp pricing level, CONCESSION IS 3BP. 

FINAL BOOKS:

$500m 3yr FRN - $1.150bn (2.30x) - PEAK $1.20BN

$500m 3yr FXD - $1.050bn (2.10x) - PEAK $1.50BN

[BANCO DE CREDITO DEL PERU] 

Banco de Credito del Peru (BCP), exp issue ratings Baa2/BB+ by Moody's/Fitch (issuer ratings Baa1/BBB-/BBB (s/s/s), US$500m 144A/Reg S 11.25nc6 fixed rate reset Tier 2 subordinated notes. Maturity date: 1/15/37. Reset Date: 1/15/32. Coupon: From the issuance date through the Interest Reset Date, the new notes will bear interest at a fixed rate coupon. On the Interest Reset Date, the coupon of the New Notes will reset to a fixed rate per annum equal to the sum of (i) the then prevailing 5yr U.S. Treasury yield, plus (ii) [●] basis points (i.e., the Initial Margin). Interest Payment Dates: Semi-annually in arrears in January 15 and July 15 of each year, commencing January 15, 2026. Day Count Fraction / Business Day Convention: 30/360 (following business day, unadjusted). Denoms: US$10,000 x US$1,000. Redemption Prior to Maturity: At the option of the Issuer, with the prior approval of the SBS, on any date from October 15, 2031, until January 15, 2032 (the “Par Call Period”), the Notes may be redeemed, in whole or in part, at par plus accrued and unpaid interest. After the Par Call Period, with the prior approval of the SBS, the Notes may be redeemed, in whole or in part, at a redemption price (expressed as a percentage of principal amount and rounded to three decimal places) equal to the greater of the sum of the present values of remaining payments discounted on a semi-annual basis using the Treasury rate plus [●] basis points, or 100% of the principal amount to be redeemed. Tax or Regulatory Event. Loss Absorption: Pursuant to the Peruvian Banking Law and regulations promulgated thereunder (which include the Peruvian Subordinated Debt Regulation), the SBS may decree that in the case of the Issuer’s intervention by the SBS, or the Issuer’s dissolution and liquidation, accrued and unpaid interest and the principal amount on the Notes, in that order, on a pari passu and proportional basis (de forma equiparable (pari passu) y proporcional) with other Parity Obligations of the Issuer, be used to absorb losses of the Issuer. If the SBS were to do so, any losses of the Issuer would be absorbed first by all instruments of the Issuer that qualify as Tier I Regulatory Capital (which include common stock and other instruments representing equity, premiums on the issuance of shares and other instruments representing equity, current and retained earnings, mandatory and voluntary reserves, donations that meet with certain regulatory conditions, among others), then by all instruments representing equity of the Issuer that qualify as Tier II Regulatory Capital, and finally by redeemable subordinated debt that qualifies as Tier II Regulatory Capital, such as the Notes. Expected Listing: Luxembourg Stock Exchange. Governing Law: New York law. UOP: General corporate purposes, including, among other things, refinancing of outstanding obligations. Pricing 10/9. Settle 10/15 (T+3). 144A CUSIP / ISIN: 05971U2K2 / US05971U2K26. 

VIA BofA (B&D)/GS/JPM/Santander joint active books. 

Announced as a benchmark, we heard initial price thoughts as 5.875% area.

Guidance came in at 5.75% area (+/- 5).

Ultimately, a $500m deal priced as follows:

$500m 5.65% 1/15/37 99.750 5.70%. MW+30. Back-end reset: T+196.1. 

As for r/v, outstanding BCP was quoted as follows:

-BCP 3.250% due 09/30/31nc26 $97.95 (5.442%; G179) - $500M pxd Mar 2021 b/e +245

-BCP 5.800% due 03/10/35 nc30 $101.615 (5.383%; G169) - $600M pxd Sep 2024 b/e +224

-BCP 6.450% due 07/30/35 nc 04/30/30 $104.125 (5.416%; G172) - $750M pxd 4/23/25 b/e +248.6

** Outstanding Jul 35nc30 5.416%; plus 15-20bp for ‘35/’37 extension, call f/v 5.60% (10bp)

   However, looking at BCP vs the sovereign gets you to a different outcome: 

Peru Sov was quoted as follows:

Republic of Peru (Baa1/BBB-/BBB)
-PERU 2.844% due 06/20/30 T+58bp (G60; $93.859; 4.302% YTC) - $750M pxd Jun 2019
-PERU 2.783% due 01/23/31 T+70bp (G67; $92.343; 4.423% YTC) - $3.75B pxd Apr 2020
-PERU 5.375% due 02/08/35 T+97bp (G103; $102.007; 5.096% YTC) - $1.25B pxd Aug 2024

** BCP 5.800% Mar 35nc30 G169 is  ~109 back of PERU Jun 30s G60 and BCP 6.450% Jul 35nc30 is ~112 back of PERU Jun 30s G60. Call sov/T2 differential +110bp

So PERU Jan 31s 4.423% YTC; plus extension, call Jan 32s 4.55%; plus 110bp spread = 5.65% f/v. (5bp nic)

Taking a mid-point between the two approaches (10bp vs BCP outstandings; 5bp vs Peru) CONCESSION IS 8BP.

Comps away:

Peruvian T2s:

Banco Internac Del Peur (Baa3/BB+)
-BINTPE 6.397% due 04/30/35 nc30 $103.7 (5.467%; G177) - $350M pxd Jan 2025 b/e +206.7

Banco BBVA Peru SA (Baa2/BB+)
-BCOCPE 6.200% due 06/07/34 nc 03/07/29 $104.150 (4.864%; G124) - $300M pxd Mar 2024

Scotiabank Peru SA (Baa2/NR/BBB)
-BNSPE 6.100% due 10/01/35 nc30 $103.717 (5.241%; G152) - $400M pxd 6/26/25 b/e +230.9

FINAL BOOKS: 

$500m 11.25nc6 - $800M (1.6x) - PEAK $1.000bn

[GS PRIVATE CREDIT CORP] 

Goldman Sachs Private Credit Corp “GSCRED” (Baa3/BBB-/BBB- s/s/s) US$400m (up from $300m) 144A/Reg S with reg rights long 3y FXD sr notes due 1/31/29. MWC then 1mo par call. 100 CoC. Denoms: 2,000 x 1,000. Sale into Canada: Yes - Exemption. UOP: To repay a portion of the outstanding indebtedness under the Company's Credit Facilities and for general corporate purposes. Marketing: https://dealroadshow.com/e/GSCRED_Oct25. Pricing 10/9. Settle 10/17 (T+5). 144A CUSIP: 38152BAE1. 144A ISIN: US38152BAE11. 

VIA BofA/BNP/MS (B&D)/SMBC/TSI/WFS joint active books. 

Announced with $300m size, we heard initial thoughts as T+220 area.

Went straight to launch at $400m 3y at T+200.

Ultimately, a $400m deal priced as follows:

$400m 5.375% 1/31/29 99.306 5.612% T+200. MW+30.

As for r/v, outstanding GSCRED was quoted as follows:

-GSCRED 5.875% due 05/06/28 T+173bp (G173; $101.24) - $400m pxd APRL 2025
-GSCRED 6.250% due 05/06/30 T+215bp (G218; $101.42) - $600m pxd APRL 2025

*** May ’28 G173, add 4bp for curve gets new issue 3y f/v at 177bp. Add another 3bp for L3y points to f/v at T+180bp (20bp nic). 

Also looking at May ‘30 G218, add 2bp for curve, call new issue 5y f/v at 220bp. Take away 20-25bp for 5s/3s curve gets to a new issue 3y at 197bp. Add 3bp for L3y gets points to f/v at T+200bp (flat nic).

Going midpoint, at the T+200bp pricing level, CONCESSION IS 10BP.

Some also did scratch this one and just go n/a given the wide range in f/v. 

COMPS AWAY:

Goldman Sachs BDC (Baa3/NR/BBB-)
-GSBD 5.650% due 09/09/30 T+195bp (G195; $99.85) - $400m pxd 09/04/25 +200

Blackstone Private Credit Fund (Baa2/BBB-)
-BCRED 7.300% due 11/27/28 T+135bp (G134; $106.55) - $646m pxd OCT 2024
-BCRED 5.050% due 09/10/30 T+167bp (G167; $98.48) - $500m pxd 09/03/25 +160

Apollo Debt Solutions BDC (Baa3/BBB-/BBB-)
-APODS 6.900% due 04/13/29 T+159bp (G168; $104.88) - $998m pxd FEB 2025
-APODS 5.875% due 08/30/30 T+174bp (G175; $101.62) - $400m pxd 07/14/25 +190

Ares Strategic Income Fund (Baa3/BBB-/BBB-)
-ARESSI 5.450% due 09/09/28 T+162bp (G162; $100.57) - $600m pxd 06/02/25 +178
-ARESSI 5.800% due 09/09/30 T+179bp (G180; $101.14) - $500m pxd 06/02/25 +203
-ARESSI 5.150% due 01/15/31 T+184bp (G181; $98.08) - $500m pxd 09/08/25 +185

HPS Corporate Lending Fund (Baa3/BBB-)
-HLEND 4.900% due 09/11/28 T+148bp (G148; $99.49) - $600m pxd 09/04/25 +155
-HLEND 5.850% due 06/05/30 T+175bp (G178; $101.45) - $500m pxd MAY 2025
-HLEND 5.450% due 11/15/30 T+181bp (G180; $99.56) - $500m pxd 09/04/25 +183

Golub Capital Private Credit Fund (Baa3/BBB-)
-GCRED 5.450% due 08/15/28 T+167bp (G167; $100.43) - $500m pxd 07/16/25 +183
-GCRED 5.875% due 05/01/30 T+177bp (G180; $101.45) - $500m pxd MAY 2025

North Haven Private Income Fund LLC (Baa3/NR/BBB-)
-NHPIFS 5.125% due 09/25/28 T+175bp (G175; $99.37) - $300m pxd 09/18/25 +183

 FINAL BOOK:

$400m L3yr - $950m (2.38x) - PEAK $1.275bn

[NEW MANDATES & MARKETING]

– Constellation Global Funding (the “Issuer", Debt Ticker: CONSTL) and AuguStar Life Insurance Company (“ALIC”), an Ohio domiciled life insurance company, have requested that Truist Securities, Inc., BMO Capital Markets Corp., and Goldman Sachs & Co. LLC arrange a series of fixed income investor calls on Thursday, October 9th, 2025. An electronic presentation and offering memorandum are currently available. A debut Funding Agreement-Backed Notes (“FABN”) issuance by the Issuer may follow, subject to market conditions.

Truist Securities is coordinating logistics.

Constellation Global Funding, a special purpose statutory trust organized in series and formed under the laws of the State of Delaware, has established an FABN program, under which:

the Issuer may from time to time offer Funding Agreement Backed Notes (“Notes”) in one or more series; and

the Issuer will use the net proceeds from the sale of each series of such Notes to purchase one or more funding agreements from ALIC

Company Representatives:

Anurag Chandra – Executive Chairman

Lori Dashewich – SVP, Chief Financial Officer

Sachin Jain – SVP, Chief Investment Officer

Scott Shepherd – SVP, Chief Risk Officer & Appointed Actuary

Brij Grewal – SVP, Chief Corporate Development Officer & President, Institutional Markets

Call Schedule: Thursday, October 9th, 2025

Call #1: 12:00pm – 12:50pm ET | Registration link: https://www.netroadshow.com/events/login/LE9zwo4AFaF2yVg65pi1gjY5ovmMkmaUNjX

Call #2: 1:00pm – 1:50pm ET | Registration link: https://www.netroadshow.com/events/login/LE9zwo3iYpdvnHPyC1MdBzk0f3aTAgpyZIy

Call #3: 2:00pm – 2:50pm ET | Registration link: https://www.netroadshow.com/events/login/LE9zwo49eeVsyeCSscowe0HEH7C0yFEHbwT

Electronic Investor Presentation Details:

URL: www.netroadshow.com

Entry Code: CGF2025

Direct Link: www.netroadshow.com/nrs/home/#!/?show=d13e9696