Corporate Debt Sales Exceed $1 Trillion at Fastest Pace Since 2020 Amid Uncertainty

Corporate debt sales have surpassed $1 trillion this year, the fastest pace since 2020, driven by a massive wall of debt coming due and falling yields. Companies are selling debt at historically low borrowing costs ahead of a seasonal slowdown. The high-grade market has largely recovered from a brief shutdown in April, with spreads narrowing to their tightest reading of the year. Deals are clearing through the market with minimal concessions, generating demand of 3.7 times the size of new deals.

Corporate debt sales have surpassed $1 trillion this year, marking the fastest pace since 2020, according to Bloomberg [1]. The surge in debt sales is largely attributed to a massive wall of debt coming due and falling yields. Companies are taking advantage of historically low borrowing costs to refinance and raise capital ahead of a seasonal slowdown later in the year.

The high-grade market, which includes investment-grade bonds, has largely recovered from a brief shutdown in April following tariff announcements. Spreads on these bonds have narrowed to their tightest reading of the year, indicating a strong demand for corporate debt. Deals are clearing through the market with minimal concessions, averaging 3.3 basis points this year compared to 3.5 basis points last year [1].

Companies including MSCI Inc. and Daimler Truck are actively participating in the market to capitalize on favorable conditions. The annual supply of fresh investment-grade bonds surpassed $1 trillion on Tuesday, a day earlier than it did last year. Refinancings and mergers and acquisitions, such as Japanese telecom giant NTT Inc.’s sale of more than $11 billion in bridge loans and Mars Inc.’s $26 billion bonds to fund its acquisition of foodmaker Kellanova, have contributed to this milestone [1].

The large amount of refinancing has minimized this year’s net supply, which was down by about 33% as of last week. This has helped to keep spreads tight and valuations on the tighter end of historical norms. However, analysts like Jon Curran, head of investment grade credit at Principal Asset Management, caution that while demand is strong, the fundamentals of the overall market and corporate issuers remain in good shape [1].

In another significant development, Coinbase Global Inc. (COIN) announced a $2 billion convertible note offering, which triggered a pre-market stock drop of over 2% [2]. The offering includes two tranches—$1 billion maturing in 2029 and $1 billion maturing in 2032—and is aimed at covering hedging costs, general corporate needs, and potential share repurchases. While the move reflects a broader trend in the crypto industry, it has sparked mixed reactions from analysts. Compass Point downgraded Coinbase to "Sell," while Benchmark maintained a "Buy" rating with a higher price target [2].

As the year progresses, corporate debt sales are expected to slow down due to seasonal factors and potential regulatory changes. Companies and financial firms are advised to complete their funding needs while they can, ahead of uncertainty around policy changes in the second half of the year [1].

References:
[1] https://www.bloomberg.com/news/articles/2025-08-05/corporate-debt-sales-top-1-trillion-at-fastest-pace-since-2020
[2] https://www.ainvest.com/news/coinbase-2b-convertible-notes-spark-2-pre-market-drop-2508/