Municipals round out session flat ahead of $10 billion calendar; Atlanta readies $1.25 billion

By Sheri Kasprzak

New York, Feb. 23 – Municipals closed Monday unchanged as the market awaits word about monetary policy from Federal Reserve chairwoman Janet Yellen later this week, insiders said. Munis largely ignored Treasuries, which rose on anticipation of a dovish statement to Congress from Yellen and on weak housing data.

Yields were flat as investors wait for one of the largest new-issue slates of the year. About $9.8 billion of new offerings are on tap in the week ahead, said Tom Kozlik, municipal credit analyst with Janney Montgomery Scott LLC.

Treasuries finally rallied after a long slump, pushed Monday by speculation that Yellen will make rather dovish remarks on monetary policy at a Congressional hearing Tuesday and Wednesday. Additionally, weak housing data shoved the 10-year and 30-year yields down 7 basis points and the five-year bond yield down 5 bps.

Atlanta preps large deal

Heading up the week’s new issues is a $1.25 billion water and wastewater refunding offering from the City of Atlanta.

The city will sell the debt (Aa3/AA-/A+) through senior managers Loop Capital Markets LLC and Goldman Sachs & Co.

The city last came to market with $178,735,000 of water and wastewater bonds in September of 2013. Those bonds are due Nov. 1, 2038 and bear interest at 67% of Libor plus 150 bps.

Proceeds from this week’s deal will be used to refund the city’s series 2001A, 2004 and 2009A water and wastewater revenue bonds.

Clark school bonds set

Leading Tuesday’s competitive calendar, the Clark County School District of Nevada is expected to price $398,405,000 of series 2015 general obligation refunding bonds (A1/AA-). Zions Bank Public Finance is the financial adviser on the deal.

The offering includes $266.64 million of series 2015A bonds, which are due 2016 to 2019, and $131,765,000 of series 2015B bonds, which are due 2016 to 2022.

Proceeds will refund existing G.O. debt.

University bonds planned

Coming up Wednesday, the University of Massachusetts School Building Authority is slated to price $470,405,000 of revenue bonds in a two-tranche offering.

The bonds (Aa2/AA-/AA) will be offered through Citigroup Global Markets Inc. and Raymond James/Morgan Keegan.

The authority intends to use the proceeds to finance capital projects at the Boston campus, including the construction of an athletic training facility, improvements to a library, electrical upgrades and other campus-wide improvements, as well as to refund existing revenue bonds.

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