Toyota Motor Corp.’s in-house lender issued $1.75 billion of bonds linked to auto loans, marking one of the first asset-backed deals designed to be environmentally friendly.
The proceeds of the offering, which was increased from about $1 billion, will be used to finance vehicles that are powered by hybrid or alternative fuel, deal documents show. The cars will be required to meet standards of energy efficiency in regulations set by the California Environmental Protection Agency’s Air Resources Board.
The top-ranked portion of the deal maturing in 2.06 years priced to yield 15 basis points, or 0.15 percentage point, more than the benchmark swap rate, according to a person with knowledge of the offering who asked not to be identified, citing lack of authorization to speak publicly. Citigroup Inc., Bank of America Corp. and Morgan Stanley arranged the sale, the person said.