Longer-term yields fall; Raleigh-Durham Airport sells bonds; Wichita to sell $192.2 million

By Cristal Cody

Tupelo, Miss., Aug. 5 - Municipal bonds were stronger on Thursday as investors sought longer-term maturities.

"Yields, especially out past six or seven years, were down 1 to 2 basis points across the board," said Alan Schenkel, managing director at Janney Montgomery Scott LLC.

"The primary market did well. The new issues are about cleaned up for the week, and there's not a big calendar for the next week. Demand is strong, supply is limited, and I expect the strength to continue."

Several issuers have brought offerings during the week, including the State of Minnesota on Tuesday and the Raleigh-Durham Airport Authority of North Carolina on Thursday.

The authority priced $313.87 million in series 2010 revenue refunding bonds.

The $238.785 million series 2010A bonds have serial maturities from 2011 through 2030 and a term bond due 2036. The $75.085 million series 2010B bonds have serial maturities from 2012 though 2025.

The series 2010A bonds priced "on the long end with 5% coupons to yield 4.45%," Schenkel said.

The bonds were sold through a negotiated sale with Bank of America Merrill Lynch as the senior manager.

Additional pricing terms were not immediately available.

Proceeds will be used to refund the authority's series 2008A-B bonds and terminate a prior interest-rate-swap agreement.

"People are looking for paper," Schenkel said. "Short-term yields are so low. We're seeing more and more movement to longer maturities from investors because they're trying to pick up yield."

Kentucky Asset/Liability to sell

Meanwhile, a few new issuers, including the Kentucky Asset/Liability Commission, announced plans to sell shorter-term bonds over the month of August.

The Kentucky Asset/Liability Commission intends to sell $468.15 million in general fund notes, according to a preliminary official statement released Thursday.

The first series 2010 funding notes have serial maturities from 2011 through 2020.

J.P. Morgan Securities Inc. is the senior manager of the negotiated sale.

Proceeds will be used to finance or refinance outstanding obligations and to fund state medical insurance fund obligations of the Teachers' Retirement System of the State of Kentucky.

Hamden, Conn., deal ahead

Looking ahead to the next week, the Town of Hamden, Conn., expects to sell $51.725 million in general obligation bond anticipation notes, according to a notice of sale.

The notes are due Aug. 24, 2011.

The notes will price through a competitive sale on Aug. 12.

Webster Bank, NA is the financial adviser.

Proceeds will be used to refinance BANs that mature on Aug. 25, 2010 and to finance school and town projects.

Wichita to price

Coming up later in the month, the City of Wichita, Kan., plans to bring $192.2 million in G.O. bonds and notes through a competitive sale on Aug. 17, according to an official notice of sale.

The sale includes $22.315 million in series 2010A sales tax refunding bonds, $29.885 million in series 2010B refunding bonds and $140 million in series 240 G.O. improvement temporary notes.

The series 2010A bonds have serial maturities from 2012 though 2019, and the series 2010B bonds have serial maturities from 2011 through 2018. The series 240 notes are due Sept. 15, 2011.

Springsted Inc. is the financial adviser.

Proceeds will be used to pay the principal of and redemption premium on the city's outstanding series 2004 G.O. sales tax bonds that mature on or after April 1, 2012; refund the outstanding series 768, 770, 772, 773 and 774 bonds; and provide temporary financing for improvements to the water system aquifer storage and recovery project.

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