U.S. Corporate And Muni Debt Issuance To Hold Steady, CUSIP Requests Show

Pre-Trade Municipal Bond Activity Edges Higher in June

NEW YORK, NY, July 14, 2016 – CUSIP Global Services (CGS) today announced the release of its CUSIP Issuance Trends Report for June 2016.  The report, which tracks the issuance of new security identifiers as an early indicator of debt and capital markets activity, suggests a steady issuance of new corporate and municipal debt offerings over the next several weeks.

Total CUSIP requests for all U.S. and Canadian corporate securities reached 3,864 in June, up 9% from May monthly totals. Within that broad asset class, there were 797 security identifier requests for new U.S. corporate debt issues, a decline of 9% from May, and 304 CUSIP request for Canadian corporates, a 20% increase over the previous month. On a year-over-year basis, corporate CUSIP request volume for both debt and equity asset classes across the U.S. and Canada was down 0.3% through June 2016 versus June 2015, reflecting weak volumes in January 2016 and comparatively strong issuance volumes in the early part of 2015.

The volume of requests for new municipal CUSIP identifiers saw a fifth consecutive month-to-month increase in June.  A total of 1,754 new municipal bond identifier requests were made over the course of the month, a 1% increase from May.  On a year-over-year basis, municipal bond identifier requests were up 1.3% in June.

Regionally, municipal bond issuers in Texas demanded the highest volume of new CUSIP identifiers in the first half of 2016, accounting for a total of 1,013 identifier requests during the period.  Texas was followed by New York (774 CUSIP requests) and California (656 CUSIP requests).

“While the month-to-month growth rate of new CUSIP requests in the corporate debt and municipal bond market has slowed from the break-neck pace we were seeing earlier in the year, we’re still seeing indications of very steady new issuance volume for the coming months,” said Gerard Faulkner, Director of Operations for CUSIP Global Services.  “As we turn the corner to the second half of the year, we expect the CUSIP indicator to be a telling signal for the market appetite of major debt and equity issuers.”

International debt and equity CUSIP International Numbers (CINS) were mixed in June. Requests for new international debt CINS were down 9%, while requests for new equity CINS were up 48%.  On a year-over-year basis international debt CINS were down 30% and international equity CINS were down 61% through June 2016.

“Given all of the uncertainty in the global economy right now, it’s actually quite amazing that CUSIP request volume has stayed so strong,” said Richard Peterson, Senior Director, S&P Global Market Intelligence. “Clearly, issuers across several asset classes still see an attractive environment for raising new capital and that sentiment is continuing to show up in our CUSIP request data.”

CUSIP Issuance Trends

June Activity

In a month that was witness to financial aftershocks following the historic referendum in Great Britain approving its withdrawal from the European Union, the order flow for CUSIPs among many asset classes held firm if not improving. For example, the number of CUSIPs requested in June for upcoming corporate securities reached 3,864, up from 3,544 orders in May. These results marked the best month for corporates CUSIP orders in the second-quarter and the second-best monthly showing of the year. The largest component among corporate CUSIP orders last month was the 797 security identifier requests for upcoming domestic corporate debt issues. However, for the first six months of 2016 domestic corporate debt CUSIP demand has dropped over 16% as 4,081 orders were processed and billed compared to 5,011 orders in the first half 2015. Total corporate CUSIP orders in the first half 2016 reached 21,183 compared to 21,251 in the first six months of 2015.

Municipal CUSIP demand in June saw 1,754 orders compared to May’s count of 1,740. Long term muni note CUSIP order volume totaled 107 last in June compared to 36 requests in May. Short term note muni CUSIP orders also advanced as 176 orders were handled last month up from 62 in May. For those asset classes the results marked their high water mark for the year. For the first half of 2016 total municipal CUSIP orders, including all asset classes, totaled 9,603 up 2.3% from the count of 9,385 set in the first six months of 2015. CUSIPs for scheduled public finance offerings from Texas issuers were the most active in the first half 2016 as 1,013 CUSIPs orders took place. New York State was next with 774 municipal CUSIP orders followed by California issuers with 656 CUSIP requests.

CUSIP activity for upcoming international equity and international debt issues remained on divergent paths. International equity CUSIP orders rose in June to 188 while international debt CUSIP demand, following May’s 2016 leading monthly count of 265 CUSIPs, edged lower as 241 orders were handled. For the first half of 2016 international equity CUSIP orders have dropped -61% to 1,068 compared to 2,707 in the first half 2015. Meanwhile, international debt CUSIP demand has declined almost -30% in the first half 2016 from year earlier results as 1,139 CUSIPs were sought compared to 1,618 a year ago. Finally, total PPN CUSIP order volume ended June 2016 with 235 requests compared to 225 in May. In the first six months of 2016 PPN CUSIP demand has slipped -7.4% from a year ago as 1,274 orders were processed versus 1,376 a year ago.

Muni Debt Issuance, Corporate Debt Issuance

Following is a breakdown of New CUSIP Identifier requests by asset class year-to-date, through June 2016:

Muni Debt Issuance, Corporate Debt Issuance

About CUSIP Global Services

The financial services industry relies on CGS’ unrivaled experience in uniquely identifying instruments and entities to support efficient global capital markets. Its extensive focus on standardization over the past 45 years has helped CGS earn its reputation as a trusted originator of quality identifiers and descriptive data, ensuring that essential front- and back-office functions run smoothly. Relied upon worldwide as the industry standard provider of reliable, timely reference data, CGS is also a founding member and co-operates the Association of National Numbering Agencies (ANNA) Service Bureau, a global security and entity identifier database for over 34 million public and privately traded instruments, contributed by 92 national numbering agencies and 27 partner agencies representing 255 different countries. CGS is managed on behalf of the American Bankers Association (ABA) by S&P Global Market Intelligence, with a Board of Trustees that represents the voices of leading financial institutions. For more information, visit www.cusip.com.

About The American Bankers Association

The American Bankers Association represents banks of all sizes and charters and is the voice for the nation’s $13 trillion banking industry and its 2 million employees.  Learn more at www.aba.com.

For More Information:

Christina Twomey
[email protected]
212-542-8033

[1] “U.S. & Canada Corporates” totals reflect requests for both equity and debt identifiers

[2] “International” Debt refers to market requests for CUSIP International Numbers (“CINS”) for non-U.S. debt offerings

[3]  “International” Equity refers to market requests for CUSIP International Numbers (“CINS”) for non-U.S. equity offerings