Fighting Irish brings $150 million refunding bonds at 5%; municipals sag on active primary

By Sheri Kasprzak

New York, Sept. 9 - Municipals ended a fairly quiet Wednesday with a slightly sour tone, traders reported.

"It's looking a little weaker, especially out on the long end," said one trader.

"[Yields are] maybe 2, 3 basis points higher on the long end," the trader said. "The short end of the yield curve is mostly unchanged, maybe off by 1 basis point or so. Treasuries were really having a hard time making any sort of movement today, so that might have something to do with it."

Meanwhile, Wednesday's pricing action was led by an interesting offering from the University of Notre Dame du Lac. The university sold $150 million in revenue refunding bonds through St. Joseph County, Ind.

"It's mostly interesting because they don't really issue bonds very often," said one sellside source asked about the bonds.

"I think pricing came out very well for them. They're a triple-A rated issuer, and they don't come to market often, so I think it's a good pricing for them."

The sellsider said the university has a lot of other attributes in its favor that helped it achieve good pricing, including a reputation as a solid educational institution and a strong private funding base.

The 5% series 2009 educational facilities revenue refunding bonds priced at par. The bonds have a 27-year term.

Morgan Stanley & Co. Inc. sold the bonds, the proceeds of which will be used to refund the university's series 1998 and 2005 bonds.

Galveston County sells bonds

In other pricing news Wednesday, Galveston County in Texas priced $137.69 million in series 2009 road, building and flood bonds (Aa2//AA) on Wednesday, according to a pricing sheet.

The sale included $75 million in series 2009A unlimited tax road Build America Bonds, $45 million in series 2009B taxable county building Build America Bonds and $17.69 million in series 2009C taxable flood bonds.

The 2009A bonds are due 2011 to 2023 with a term bond due 2029. The coupons range from 1.248% to 5.408%, all priced at par. The 2029 bonds have a 6.205% coupon, also priced at par.

The 2009B bonds are due 2011 to 2019 with a term bond due 2029. The serials have coupons from 1.248% to 4.708%, all priced at par. The 2029 bonds have a 5.905% coupon, priced at par.

The 2009C bonds are due 2011 to 2031 with coupons from 4% to 5.625%. A 2029 term bond has a 6.205% coupon, priced at par, and a 2036 term bond has a 6% coupon, priced at par.

Coastal Securities Inc. was the senior manager.

Proceeds will fund roadway, public building and drainage improvements.

Secondary weakens

Moving to the secondary market, traders said there was little trading activity, but weakness has crept into the market as Treasuries struggled to gain any ground.

Among Wednesday's light trading action, Nassau County, N.Y., saw some interest in its recently priced series 2009G Build America Bonds. The 5.375% 2025 bonds were seen at 5.351%.

Elsewhere, the Tarrant County Cultural Education Facilities Financing Agency of Texas saw some action for its series 2009 sold for Hendrick Medical Center. The 5.25% 2028 bonds were seen at 4.761%.

Central Puget Sound RTA sale planned

Looking out on the horizon, the Central Puget Sound Regional Transit Authority of Washington State plans to price $400 million in series 2009 sales tax and motor vehicle excise tax bonds, according to a preliminary official statement.

The offering includes $100 million in series 2009P-1 and series 2009P-2T Build America Bonds and $300 million in series 2009S-2T Build America Bonds.

Citigroup Global Markets Inc. is the lead manager for the 2009P-1 bonds and Citi and Goldman, Sachs & Co. are the bookrunners for the series 2009P-2T Build America Bonds and the series 2009S-2T Build America Bonds.

Proceeds will fund the construction, planning, design or extension of improvements to the authority's high-capacity transportation facilities.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.