Intermediate, long bonds firm; New Jersey Transportation sells $600 million of bonds early

By Sheri Kasprzak

New York, May 3 - Municipal yields were yet again firmer, and the most improvement was seen in the middle-to-long ranges, said market insiders.

Yields were seen better by 2 basis points past 15 years, said one trader reached during the afternoon. The rest of the market was flat with a firmer tone.

"The tone is firm overall, but the real improvement is past 15 [years]," said the trader.

Meanwhile, low supply pushed up the pricing of the New Jersey Transportation Trust Fund's $600 million sale of series 2011A transportation system bonds.

"There's really not much else going on," said one market insider when asked about the pricing, which was originally slated to price for institutional investors Wednesday.

"There's a good amount of demand out there, but there's nothing [pricing]. They were able to get pretty good pricing."

The bonds are secured by annual state appropriations, according to Alan Schankel, managing director with Janney Montgomery Scott LLC. But that didn't stop Moody's and Standard & Poor's from lowering the ratings on the bonds by one notch along with the state's general obligation debt, Schankel noted.

The bonds (A1/A+/AA-) were sold through J.P. Morgan Securities LLC.

The bonds are due 2013 to 2031 with term bonds due in 2035 and 2041. The serial coupons range from 3% to 5.25%. The 2035 bonds have a 6% coupon. The 2041 bonds have a 5.5% coupon.

Proceeds will be used to fund transportation-related capital projects.

Oregon brings university bonds

Elsewhere during the session, the State of Oregon priced $177.92 million of series 2011 G.O. bonds for the Oregon University System, said a pricing sheet.

The sale included $49.69 million of series 2011E bonds, $6.29 million of series 2011F bonds, $52.185 million of series 2011G bonds and $69.755 million of series 2011H bonds.

Merrill Lynch and Citigroup Global Markets Inc. were the senior managers for the bonds (Aa1/AA+/AA+).

The 2011E bonds are due 2012 to 2031 with term bonds due in 2036 and 2041. The serial coupons range from 2.5% to 4.5%. The 2036 bonds have a split maturity with a 4.625% coupon and a 5% coupon. The 2041 bonds have a split maturity with a 4.75% coupon and a 5% coupon.

The 2011F bonds are due 2012 to 2017 with coupons from 0.58% to 3.2%, all priced at par.

The 2011G bonds are due 2017 to 2031 with term bonds due in 2036 and 2041. The serial coupons range from 4% to 5.25%. The 2036 bonds and the 2041 bonds have 5% coupons.

The 2011H bonds are due 2012 to 2031 with term bonds due in 2036 and 2041. The serial coupons range from 3% to 5.25%. The 2036 bonds and the 2041 bonds have 5% coupons.

Proceeds will be used to finance projects within the university system.

Wellmont bonds price

In other primary action, the Health, Educational and Housing Facilities Board of the County of Sullivan, Tenn., sold Tuesday $76.165 million of series 2011 hospital revenue refunding bonds for the Wellmont Health System, said a pricing sheet.

The bonds (/BBB+/BBB+) were sold through Merrill Lynch.

The bonds are due 2026 and 2032 with a 6% coupon and a 6.5% coupon, respectively. Both bonds priced at par.

Proceeds will be used to refund the health-care system's series 2006A bonds.

The health-care system is based in Johnson City, Tenn.

Georgia gas bonds sold

In other news, the Municipal Gas Authority of Georgia priced $75 million of series 2011K gas revenue refunding bonds on Tuesday, said a pricing sheet.

The bonds (MIG 1/SP-1+/F1+) are due May 23, 2012 and have a 2% coupon priced at 101.443.

Wells Fargo Securities LLC and J.P. Morgan Securities LLC were the senior managers.

Proceeds will be used to refund a portion of the authority's outstanding debt.

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