U.S. Corporate And Municipal Debt Issuance Poised To Surge, CUSIP Requests Show - Pre-Trade Corporate Debt Activity Reaches Highest Level Of 2016

CUSIP Global Services (CGS) today announced the release of its CUSIP Issuance Trends Report for May 2016.  The report, which tracks the issuance of new security identifiers as an early indicator of debt and capital markets activity, suggests continued growth in issuance of new corporate and municipal debt offerings over the next several weeks.

Total CUSIP requests for new U.S. corporate debt increased 14% over April totals, with a total of 877 new identifiers requested over the course of May. This marked the highest monthly volume of CUSIP requests for corporate debt identifiers since July 2015.  Requests for new CUSIP identifiers for U.S. equity identifiers increased 12% over the same period. 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 17% through May 2016 versus May 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 fourth consecutive month-to-month increase in May.  A total of 1,740 new municipal bond identifier requests were made over the course of the month, a 21% increase from April.  On a year-over-year basis, municipal bond identifier requests were down 2% in May.

Regionally, municipal bond issuers in Texas demanded the highest volume of new CUSIP identifiers in May, accounting for a total of 171 identifier requests during the month.  For the first five months of 2016, municipal debt issuers in Texas accounted for roughly 10% of all municipal CUSIP request volume.

“The sheer volume of requests for IDs for new debt instruments is sending a clear signal that issuers are indeed gearing up for new offerings,” said Gerard Faulkner, Director of Operations for CUSIP Global Services.  “While, at the absolute level, we’re still behind where we were at this time last year, the recent trend in month-to-month increases has become hard to ignore.”

International debt and equity CUSIP International Numbers (CINS) were mixed in May. Requests for new international debt CINS were up 34%, while requests for new equity CINS were down 37%.  On a year-over-year basis international debt CINS were down 32% and international equity CINS were down 61% through May 2016.

“With key economic data showing persistently weak growth numbers, interest rates continue to stay low and create an environment where corporations and municipalities can’t resist issuing new debt,” said Richard Peterson, Senior Director, S&P Global Market Intelligence.  “Until the broader economy starts showing some signs of more significant recovery, we expect this trend to continue.”

To view a copy of the full CUSIP Issuance Trends report, please click here.

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