SOURCE: National Rural Utilities Cooperative Finance Corporation (NRUCFC)

National Rural Utilities Cooperative Finance Corporation (NRUCFC)

February 02, 2012 16:50 ET

CFC Sells $800 Million of Collateral Trust Bonds

DULLES, VA--(Marketwire - Feb 2, 2012) - The National Rural Utilities Cooperative Finance Corporation (CFC) (NYSE: NRU) (NYSE: NRC) has closed its previously announced underwritten public offering of $800 million in collateral trust bonds (CTBs). CFC sold $400 million of three-year bonds and $400 million of 10-year bonds.

"We initially accessed the capital markets with a $500 million transaction. We upsized the offering because of overwhelmingly strong demand from investors," CFC CEO Sheldon C. Petersen said. "The market reaction to this sale is a reflection of CFC's expanding financial strength and underscores the stability of the electric co-op network."

The three-year bonds priced at a spread of 80 basis points over the yield on the three-year benchmark U.S. Treasury; the 10-year bonds priced at a spread of 115 basis points over the yield on the 10-year benchmark U.S. Treasury. The bonds are rated A1 by Moody's Investors Service and A+ by Standard & Poor's Corporation.

"CFC is constantly monitoring the capital markets to be prepared to take advantage of good issuance windows," CFC Treasurer Andrew Don said. "The combination of a favorable market and rate environment along with strong investor interest gave CFC the leverage to drive down credit spreads and realize a very attractive all-in coupon."

The proceeds will be used by CFC for general corporate purposes, including the repayment of short-term debt, and -- together with cash on hand and other funding sources -- will fund the repayment of $1 billion in 7.25-percent medium-term notes maturing March 1, 2012.

This press release shall not constitute an offer to sell or the solicitation of an offer to buy, nor shall there be any sale of these securities in any state in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such state.

About CFC
The National Rural Utilities Cooperative Finance Corporation (CFC) is a nonprofit finance cooperative created and owned by America's electric cooperative network. With $20 billion in assets, CFC is committed to providing unparalleled industry expertise, flexibility and responsiveness to serve the needs of its member-owners. CFC can be found online at www.nrucfc.coop.

Contact Information

  • Contacts:
    Brad Captain
    Corporate Communications
    Email Contact
    703-467-1646

    Ling Wang
    Banking & Investor Relations
    Email Contact
    703-467-1628