Jun 10, 2020 - Economy

Investment grade bond issuance has doubled 2019's pace

Data: Fitch Ratings, Bloomberg; Chart: Axios Visuals

The corporate bond bonanza continues in the U.S., as non-financial investment grade corporate bond issuance reached $584 billion through May, ratings agency Fitch said Tuesday.

Why it matters: That was more than double the amount registered over the same time frame in 2019 and is fast approaching the entire amount issued that year, which was the second highest full-year issuance on record.

  • "If issuance continues at the same pace going forward, it will easily top the previous high of $644 billion in 2017," Fitch said in a statement.

By the numbers: The total investment-grade bond universe ended May at $4.4 trillion, up from $4.0 trillion at the end of 2019. The average par weighted coupon was 3.4% compared with 4.1% in 2019 and 5.9% during the 2008 financial crisis, Fitch said.

  • Roughly 85% of this year’s bond volume was issued in March, April and May.
  • Debt in the BBB category, which represents 57% of outstanding investment-grade bonds, made up more than half of the new volume.
  • More than half of the issuance came from the technology, transportation, energy, health/pharmaceutical and utility/power/gas sectors.
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