Municipals tumble with Treasuries as Greek deal looms; City of Industry authority sells bonds

By Sheri Kasprzak

New York, June 26 – Municipals slid on the day Friday as Treasuries were pressured by a potential agreement between Greece and its creditors, market insiders said.

Yields on top-rated munis were seen higher by as much as 4 basis points.

Meanwhile, the 30-year and 10-year Treasury yields rose by 9 bps.

The week ahead, shortened by Friday’s observance of Independence Day, will feature just $3.4 billion of new issues.

Leading the lighter new-issue slate, the Texas Transportation Commission is on tap to price $800 million of state highway fund refunding bonds (Aaa/AAA/) on Tuesday.

Citigroup Global Markets Inc. and BofA Merrill Lynch will bring the bonds, which are due 2017 to 2026.

Proceeds will refund existing revenue bonds.

City of Industry brings debt

Among Friday’s light primary activity, the City of Industry Public Facilities Authority of California hit the market with $574,905,000 of series 2015 tax allocation revenue refunding bonds.

The bonds (/AA/) were sold through Stifel, Nicolaus & Co. Inc.

The deal included $239,525,000 of series 2015A taxable TARBs, $7.23 million of series 2015A taxable subordinate TARBs, $249.77 million of series 2015B taxable TARBs, $33,815,000 of series 2015B taxable refunding TARBs, $7.14 million of series 2015A tax-exempt TARBs and $37,425,000 of series 2015B taxable TARBs, said a pricing sheet.

The 2015A taxable TARBs are due 2017 to 2024 with 1.764% to 4.344% coupons and all priced at par.

The 2015A taxable subordinate TARBs are due 2017 to 2025 with 5% coupons and 1.04% to 2.74% yields.

The 2015B taxable TARBs are due 2017 to 2023 with a term bond due in 2027. The serial coupons range from 1.914% to 4.294% and all priced at par. The 2027 bonds have a 5.044% coupon and priced at par.

The 2015B taxable refunding TARBs are due 2017 and 2024. The 2017 bonds have a 2.5% coupon and priced at 99.906 to yield 2.564%, and the 2024 bonds have a 5.75% coupon and priced at 98.354 to yield 6%.

The 2015A tax-exempt TARBs are due 2017 to 2025 with 5% coupons and yields from 1.04% to 2.74%.

The 2015B taxable TARBs are due 2017 to 2020 with a term bond due in 2027. The serial coupons range from 1.914% to 3% with yields from 1.914% to 3.389%. The 2027 bonds have a 5.044% coupon and priced at par.

Proceeds will be used to refund outstanding tax allocation revenue bonds.

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