Municipal yields firm again ahead of Thanksgiving; L.A. Water and Power brings $760.2 million

By Sheri Kasprzak

New York, Nov. 23 - Municipal yields fell for the second straight session as volume continued to stabilize ahead of the Thanksgiving holiday.

"Certainly some issuers are trying to get things done ahead of the holiday, but yields are still making it difficult for some issuers to price, especially those with refundings," said one trader.

"I'm sure things will probably pick up again once the holiday is over, but I don't think it [volume] will be nearly as huge as it was a few weeks ago. Yields seem to be a little more subdued. Today we're probably down 3 to 4 basis points across the curve, maybe down a bit more in spots out long."

Meanwhile, pricing action was led by the Los Angeles Department of Water and Power's $760.2 million sale of series 2010D power system revenue bonds.

The bonds were sold through Goldman, Sachs & Co. and De La Rosa & Co.

The bonds are due 2041 and 2045. The 2041 bonds have a 7% coupon priced at par, and the 2045 bonds have a 6.574% coupon, also priced at par.

Proceeds will be used to make improvements to the city's power supply system.

MTA brings bonds

Elsewhere, the Metropolitan Transportation Authority of New York City priced $755 million of series 2010D transportation revenue bonds (A2/A/A+), said a pricing sheet.

Citigroup Global Markets Inc. and J.P. Morgan Securities LLC were the senior managers. The co-lead managers were Ramirez & Co. Inc. and Siebert Brandford Shank & Co. LLC.

The bonds are due 2011 to 2030 with term bonds due 2034 and 2040. Serial coupons range from 1.5% to 5.25%. The 2034 bonds have a split maturity with a 5% coupon and a 5.25% coupon. The 2040 bonds have a 5.25% coupon.

The MTA expects to use the proceeds to pay holders of its transportation revenue notes CP-1.

RTD sells $316.5 million

In other transportation offerings, Colorado's Regional Transportation District sold $316.5 million of certificates of participation, said a pricing sheet.

The COPs (/A-/) were sold through Morgan Stanley & Co. Inc.

The offering included $216.5 million of series 2010A tax-exempt COPs and $100 million of series 2010B taxable COPs.

The 2010A COPs are due 2012 to 2022 with term COPs due 2025 and 2031. Serial coupons range from 3% to 5.5%. The 2025 COPs have a 5% coupon priced at 98.983. The 2031 COPs have a 5.375% coupon priced at 98.473.

The 2010B COPs are due June 1, 2040 and have a 7.672% coupon priced at par.

Proceeds will be used to fund transportation infrastructure projects.

The district is based in Denver.

Massachusetts prices BABs

Also during the session, the Commonwealth of Massachusetts came to market with $350 million of series 2010E Build America Bonds, said a pricing sheet.

The bonds (Aa1/AA/AA+) were sold competitively.

The bonds are due Dec. 1, 2021 and have a 4.2% coupon priced at 101.944.

Proceeds will be used to finance a portion of the commonwealth's capital plan.

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