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|Banks are marketing $600m of eight-year bonds at a yield of about 3.875%. The inaugural bond has garnered more than $6 billion of investor orders. With almost $6 billion of cash on its balance sheet, a market cap of $23.6 billion and just $2.1 billion of existing debt, the bond market will no doubt welcome the new junk bond with open wallets.|
Credit spreads (difference between corporate and benchmark yields) have fallen in line with the drop in government yields. There has rarely been a better time to issue debt.