Discover Bank priced $850 million of three-year credit card-backed securities at 20 basis points over three-month Libor, according to a regulatory filing.
The class A, 2014-2 notes, which were issued from the Discover Card Execution Note Trust, have a weighted average life (WAL) of 2.93 years and are rated Aaa’ by Moody’s Investors Service.
Citigroup Global Markets and RBS Securities each place $121.5 million of the notes. Four other underwriters -- Barclays Capital, Credit Suisse Securities, Deutsche Bank Securities, Mitsubishi UFJ Securities and RBC Capital Markets -- each placed $121.4 million.
The last time Discover issued three-year credit card notes from this trust was in October of 2013; the class A, 2013-6 notes, which have a WAL of 2.97 years, were priced to yield 35 basis points over the interpolated swaps curve.
The Class A(2014-2) tranche is expected to be the 74th tranche of Class A notes to be issued by the trust; the trust has previously issued 39 Class A tranches, 17 tranches of Class B notes, 16 tranches of Class C notes and one tranche of Class D notes.
Moody’s Investors Service has assigned a preliminary 'Aaa' rating to the latest offering. Moody's expects charge-offs to range from 2.5% - 3.0% and the principal repayment rate to range from 20% - 23%, according to the presale report.
