According to the US lender, the bonds are due August 2017, which is expected to yield 135 basis points more than similar-maturity Treasuries.
Bloomberg reported citing Trace, the bond-price reporting system of the Financial Industry Regulatory Authority, that the bank’s $5bn of 6% senior unsecured notes maturing in January 2018 traded at 119.1 cents on the dollar to yield 2.23% with a 154 basis-point spread on August 10.
The investors’ interest in the low coupon is a clear example of their confidence that they still prefer to invest into the US bank paper, although a chain of financial upturn and the $5bn "London whale" derivatives trading loss has dampen the investors’ confidence as well as submerged the reputation of JP Morgan.
Credit rating agency Moody’s downgraded JPMorgan two levels to A2 in June this year, but this could not discourage the US bank bond popularity.
Some industry analysts have said that new regulation, including Dodd-Frank and higher capital levels has played significant role in making investment in banks bonds safer.
The latest sale of bonds for a period of five year was the first bond marketing by JP Morgan. In March, it sold $2bn worth of three-year notes.
