Commercial paper said to get sweeter

Report: Issuers are taking number of steps to recharge investor interest as more commercial paper is up for renewal.


NEW YORK (CNNMoney.com) -- Facing a sizeable amount of commercial paper due for renewal, banks and other issuers are sweetening offers to lure skittish investors back in, according to a report published Monday.

Besides paying higher yields, issuers are disclosing exposure to subprime loan assets and taking steps to prevent a selloff of their assets in an effort to heighten investor interest, according to the Wall Street Journal.

The market for commercial paper, which are loans issued to raise money for short periods of time, has been particularly hard hit amid the recent subprime and larger credit market crisis. The asset-backed commercial-paper market contracted by nearly $200 billion from July to the end of August, according to the paper.

And September is gearing up to be particularly busy for the commercial paper market, the Journal reported. Next week alone, about $120 billion of commercial paper is due for renewal outside the U.S.

Even amid some signs that the market may be improving, many investors have been hesitant to wade back into the commercial paper market until big banks such as Citigroup (Charts, Fortune 500) and Deutsche Bank (Charts) report third-quarter earnings and more details about their exposure to the recent subprime crisis.

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Most stock quote data provided by BATS. Market indices are shown in real time, except for the DJIA, which is delayed by two minutes. All times are ET. Disclaimer.

Morningstar: © 2014 Morningstar, Inc. All Rights Reserved.

Factset: FactSet Research Systems Inc. 2014. All rights reserved.

Chicago Mercantile Association: Certain market data is the property of Chicago Mercantile Exchange Inc. and its licensors. All rights reserved.

Dow Jones: The Dow Jones branded indices are proprietary to and are calculated, distributed and marketed by DJI Opco, a subsidiary of S&P Dow Jones Indices LLC and have been licensed for use to S&P Opco, LLC and CNN. Standard & Poor's and S&P are registered trademarks of Standard & Poor’s Financial Services LLC and Dow Jones is a registered trademark of Dow Jones Trademark Holdings LLC. All content of the Dow Jones branded indices © S&P Dow Jones Indices LLC 2014 and/or its affiliates.