UPDATE1-AMEX prices larger $911 mln ABS deal as demand rises

(Adds quote and pricing details, byline)

By Nancy Leinfuss

NEW YORK, April 28 (BestGrowthStock) – American Express Issuance
Trust’s credit card securities offering was priced at a larger
$911.8 million size and lower funding costs to the issuer on
Wednesday amid hearty appetite from investors.

The sale’s $850 million AAA-rated 2.94-year notes priced at
a tighter spread of 25 basis points over one-month Libor,
compared with earlier guidance of 25 to 30 basis points over
one-month Libor and an initial size of $750 million for the
tranche, market sources said.

The $61.8 million AA-plus rated 2.94-year notes were priced
at a leaner spread of 60 basis points over one-month Libor,
compared with earlier guidance of 65 to 70 basis points over
one-month Libor and an initial size of $54 million, market
sources said.

American Express’s credit card securitization was met with
strong demand from investors. Appetite for ABS has been high
but supply remains limited leaving many deals oversubscribed.

“The deal priced on the tighter side of price talk
indicating there was more than enough interest from investors
for the sale. American Express is one of the better performing
trusts out there,” said Mike Kagawa, ABS portfolio manager at
Payden & Rygel.

JPMorgan Securities, Barclays Capital and Banc of America
Merrill Lynch are underwriters for the sale, sources said.

The credit card segment has been largely absent from the
ABS market this year amid sweeping changes to the
securitization landscape. A tougher regulatory and legislative
environment combined with new accounting rules and tighter
lending standards have all worked to clamp down on credit card
issuance.

After leading supply over recent years, credit card
issuance has accounted for a paltry $2 billion of the $35
billion of securities sold so far this year.

Many bank credit card issuers are turning to other funding
alternatives to securitization, like the unsecured corporate
debt market, while others are simply relying on their own
deposit base to fund new consumer loans.

Over $100 billion of credit card securities are expected to
mature this year and market participants expect just a portion
of that to funded through debt securitization.

Growth Stocks
(Editing by Leslie Adler)

UPDATE1-AMEX prices larger $911 mln ABS deal as demand rises