Munis mostly flat; market awaits $650 million deal from New York's Metropolitan Transportation

By Sheri Kasprzak

New York, Feb. 1 - Municipal yields were mostly flat Monday amid quiet trading activity, traders reported.

Meanwhile, the market is preparing for a $650 million sale of revenue bonds from the Metropolitan Transportation Authority of New York.

"It's been very quiet," said one trader reached in the afternoon.

"There's some interest out there in a few bigger deals from last week, but otherwise, not a lot is going on. I'd call it flat overall."

Among the bonds seen trading Monday were Puerto Rico Sales Tax Financing Corp.'s series 2010A subordinate bonds, which priced Wednesday. The 5.375% 2039 bonds were trading at par. The 5.25% 2036s were seen at 4.836%.

Looking to the week ahead, market insiders are gearing up for the Metropolitan Transportation Authority of New York's series 2010B revenue bonds, which are being sold through Barclays Capital Inc.

The sale includes $550 million in series 2010B-1 Build America Bonds and $100 million in series 2010B-2 tax-exempt bonds.

One sellside source connected with the deal said Monday that she feels the offering will price very well. She wouldn't elaborate on pricing targets but did note that the authority has a proven track record of successful pricings.

"They always do well," she said. "We're expecting a good sale [Wednesday]."

Proceeds from the sale will be used to fund transportation projects.

New York environmental bonds ahead

Coming up on Tuesday, the New York State Environmental Facilities Corp. plans to bring $327.125 million in series 2010 state clean water and drinking water revolving fund revenue bonds. The bonds will be sold through Siebert Brandford Shank & Co. LLC.

The offering includes $141.145 million in series 2010A bonds and $185.98 million in series 2010B Build America Bonds.

Proceeds will be used to fund clean water and drinking water projects throughout the state.

Also on Tuesday, the State of Ohio is scheduled to bring $100 million in series 2010A-B hospital revenue bonds for University Hospitals Health System Inc. Bank of America Merrill Lynch and Citigroup Global Markets Inc. are the senior managers.

Proceeds will fund the construction, renovation, equipment and acquisition of hospital facilities and refund a portion of the health system's series 2008A-E bonds.

The health system is based in Cleveland.

Indianapolis public improvement bonds to price

Later in the week, the Indianapolis Local Public Improvement Bond Bank is scheduled on Wednesday to price $205 million in series 2010A tax-exempt bonds and Build America bonds, said a preliminary official statement.

The sale includes $39.82 million in series 2010A-1 bonds and $165.18 million in series 2010A-2 Build America Bonds.

The bonds (Aa2/AA+/AA+) will be sold on a negotiated basis with Citigroup as the senior manager and J.P. Morgan Securities Inc. as the lead manager for the 2010A-2 bonds.

The 2010A-1 bonds are due 2013 to 2022, and the 2010A-2 bonds are due 2030 and 2040.

Proceeds will be used to fund construction projects.

Miami-Dade County to bring aviation bonds

Out on the horizon, Miami-Dade County in Florida is expected to price $247.5 million in series 2010 double-barreled aviation general obligation bonds, said a preliminary official statement.

The bonds (Aa3/AA-/) will be sold on a negotiated basis with Morgan Stanley & Co. Inc. as the lead manager.

Proceeds will be used to fund improvements to the county's airport.

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