Municipals dip as market awaits $11.1 billion new issues; Citizens Property’s $1 billion ahead

By Sheri Kasprzak

New York, May 18 – Municipals weakened to kick off another busy week as the market braces for about $11.1 billion of supply, sources reported Monday.

Yields on high-grade munis were seen higher by 1 to 2 basis points, outperforming Treasuries, which gave up 6 to 9 bps on profit-taking after seeing yields fall by as much on Friday.

Citizens to sell debt

The week’s new issues will be led by a massive sale from Florida’s Citizens Property Insurance Corp.

The corporation is on deck to bring $1 billion of coastal account senior secured bonds during the week in two tranches, one with a fixed rate and one with a floating rate.

The deal includes $750 million of series 2015A-1 bonds and $250 million of series 2015A-2 Sifma index bonds.

BofA Merrill Lynch is the bookrunner on the 2015A-1 bonds, and J.P. Morgan Securities LLC is the bookrunner the 2015A-2 bonds.

The corporation will deposit the proceeds from the offering into a disaster claim fund to pay hurricane catastrophe claims.

A hurricane has not made landfall in Florida since Hurricane Wilma in 2005, but the state has dealt with the effects of some close encounters and several tropical storms in the last decade.

Miami-Dade deal set

Also in play this week is a $481.79 million offering of water and sewer system revenue refunding bonds from Miami-Dade County.

The county will offer the bonds (Aa3/A+/A+) through Jefferies & Co.

Proceeds will advance refund its series 2007 and 2008C water and sewer revenue bonds.

PANYNJ bonds to price

It seems Florida and New York will dominate the market as two major deals are ahead from Empire State issuers.

The Port Authority of New York and New Jersey is ready to come to market with $500 million of consolidated bonds on Tuesday.

Barclays, BofA Merrill Lynch, Citigroup Global Markets Inc. and RBC Capital Markets LLC will lead the syndicate for those bonds.

The bonds are due June 1, 2045, and proceeds will finance capital projects.

Also ahead is a deal from New York City Municipal Water Finance Authority. The authority is on tap to price $435 million of water and sewer system second general resolution revenue bonds.

The bonds (Aa2/AA+/AA+) will be sold through lead manager Barclays.

Proceeds will be used to refund and redeem the authority’s series 2005C-D and 2006A first resolution revenue bonds.

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