Munis close flat to firmer; week's supply expected to be $2 billion; Montana State sells bonds

By Sheri Kasprzak

New York, Dec. 16 - Municipals shrugged off a weaker Treasuries market on Monday to end flat to slightly firmer in spots.

Compared with about $11 billion of new offerings last week, this week's new-issue calendar will be much lighter at $2 billion. Last week's supply hit as some issuers rushed to finalize their pricings ahead of the holiday, said Tom Kozlik, municipal credit analyst with Janney Montgomery Scott LLC.

Massachusetts deal leads

The largest offering of the lighter week comes from the Commonwealth of Massachusetts, which is set to price $525 million of series 2014A consolidated loan general obligation bonds.

The competitive offering will be conducted on Tuesday, and the bonds are due 2016 to 2019 and 2031 to 2043.

The commonwealth intends to use the proceeds to finance its current capital spending plan.

Illinois cuts bond costs 29%

Elsewhere, the State of Illinois late last week sold $350 million of series of December 2013 taxable G.O. bonds, as previously reported.

The state reduced the costs of the offering by 29%, or $20 million over the life of the bonds, Kozlik said Monday.

The offering came right on the heels of a bill to strengthen funding to the state's underfunded pension system.

In the competitive offering, the bonds are due 2014 to 2020 with a term bond due in 2038. The serial coupons range from 1% to 4% with 0.75% to 4.00% yields. The 2038 bonds have a 5.65% coupon and priced at par.

Proceeds will be used to finance capital projects within the state, school construction projects and transportation projects.

Montana State sells debt

Moving to Monday's light primary activity, the Board of Regents of Montana State University hit the market with $55.48 million of series 2013A university facilities improvement bonds.

The bonds (Aa3) were sold through lead manager Wells Fargo Securities LLC.

The bonds are due 2016 to 2033 with term bonds due in 2038 and 2043. The serial coupons range from 2% to 5%. The 2038 bonds have a 4.5% coupon and priced at 99.255, and the 2043 bonds have a 5% coupon and priced at 103.3, according to market insiders.

Proceeds will be used to finance capital improvements for the university.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.