Brandon Bell
Summary
- Bank of America is issuing a 10-year corporate note with a 6.55% coupon rate, offering a higher interest rate than other banks and certificate of deposits.
- The bank’s net interest income has remained flat but has risen above pre-pandemic levels, and deposit growth has declined for five consecutive quarters.
- Despite the decline in deposits, Bank of America’s financial ratios are healthy, and its 6.55% bond offers a higher return than most investment grade fixed income.
Later this week, Bank of America (NYSE:BAC) is issuing a 10-year corporate note with a 6.55% coupon rate for fixed income investors. The bond is offering an interest rate 90 basis points higher than the highest coupon certificate of deposits currently on the open market. The interest rate is also higher than newly issued A or BBB debt from other banks, and 25 basis points higher than Citigroup, which is a peer bank with a notch lower credit rating. It also helps that Bank of America has “too big to fail” status.
READ FULL ARTICLE HERE!
