First Union Corp. on Friday issued $150 million of floating-rate subordinated notes.

The 10-year issue floats quarterly at 12.5 basis points above the three-month London interbank offered rate, with a 4.125% minimum rate known as a "floor."

The three-month Libor is now 3.25%.

Refinancing Use Seen

One market source speculated that the issue would be used for refinancing rather than additional capital, because First Union's capital ratios far exceed regulatory minimums.

The bank's total capital ratio was 14.58% at the end of the second quarter. up from 12.27% at March 31.

First Union officials were not available for comment.

The noncallable issue is rated A3 by Moody's Investors Service Inc. and BBB-plus by Standard & Poor's Corp.

Goldman, Sachs & Co. was the lead underwriter.

Subscribe Now

Access to authoritative analysis and perspective and our data-driven report series.

14-Day Free Trial

No credit card required. Complete access to articles, breaking news and industry data.