Apple selling Swiss bonds

February 9, 2015 08:40 AM

Apple Inc. hired Credit Suisse Group AG and Goldman Sachs Group Inc. to arrange its first sale of bonds in Swiss francs, according to a person familiar with the matter.

The iPhone maker will market the securities in the near future, subject to market conditions, said the person, who asked not to be identified because they are not authorized to speak publicly.

Apple has issued the equivalent of $39 billion of bonds since April 2013, when it sold $17 billion in what at the time was the biggest corporate-bond offering ever. By borrowing in Swiss francs, the Cupertino, California-based company can take advantage of record-low funding costs after Swiss government bond yields turned negative.

“Given the rates available in Swiss francs, it has got to be definitely attractive for the company,” said Geraud Charpin, a London-based money manager at BlueBay Asset Management, which oversees more than $65.8 billion. “It’s not like Apple really needs the cash, but when you’ve got cash for nothing, why not take it.”

An official in Apple’s media relations department in London wasn’t immediately available to comment on the bond sale plans when contacted by phone today.

Investors seeking a haven from risk have driven yields on Swiss 10-year government bonds to below zero. The bonds yield minus 0.081% today, the only government securities of the same maturity in Europe to be negative, according to data compiled by Bloomberg.

Yields fell after the country’s central bank started collecting interest on lenders’ deposits. The Swiss National Bank said last month it would cut its interest rate on sight deposits, the cash-like holdings commercial banks keep with the SNB, to minus 0.75% from minus 0.25%.

About the Author