Municipals struggle after Treasuries sell off; Port St. Lucie, Hartford Healthcare offer bonds

By Sheri Kasprzak

New York, March 19 - Municipal yields climbed on Wednesday after a Treasury sell-off shoved government yields much higher, market sources said.

Muni yields were higher by 3 basis points to 6 bps but still outperformed Treasuries.

The belly of the Treasury yield curve took a massive hit from a Federal Open Market Committee meeting and a subsequent press conference that indicated the central bank's key rate could be hiked in as little as six months. The news increased the five-year Treasury note yield by 16.5 bps to 1.713% and the 10-year note yield by 9.5 bps to 2.775%. The 30-year bond yield climbed by about 2.5 bps to 3.652%.

Port St. Lucie brings bonds

Amid the day's primary action, the City of Port St. Lucie, Fla., offered up $74.74 million of series 2014 general obligation bonds.

The offering included $32.9 million of series 2014 G.O. bonds and $41.84 million of series 2014 G.O. refunding bonds, said a pricing sheet.

The G.O. bonds are due 2014 to 2035 with coupons from 1.5% to 5% and 0.25% to 4.05% yields.

The refunding bonds are due 2014 to 2029 with a term bond due in 2032. The serial coupons range from 2% to 5% with yields from 0.25% to 3.92%. The 2032 bonds have a 4% coupon and priced at 98.719 to yield 4.10%.

The bonds (Aa3/AA-/) were sold through RBC Capital Markets LLC.

Proceeds will be used to acquire and construct an eight-mile six-lane stretch of highway with landscaped median, lighted bicycle/pedestrian lanes and a bridge to connect the city to U.S. Route 1 and to refund the city's series 2005 and 2006 G.O. bonds.

Hartford Healthcare prices

Elsewhere during the session, the Connecticut Health and Educational Facilities Authority priced $92,635,000 of series 2014E revenue bonds for Hartford Healthcare.

The bonds (A2/A/A) were sold through Citigroup Global Markets Inc. and J.P. Morgan Securities LLC.

The bonds are due 2025 to 2030 with term bonds due in 2034 and 2042, said a pricing sheet. The serial coupons range from 4% to 5% with 3.67% to 4.33% yields. The 2034 bonds have a 5% coupon and priced at 102.988 to yield 4.63%. The 2042 bonds have a 5% coupon and priced at 101.274 to yield 4.84%.

Proceeds will be used to finance capital projects, refinance lines of credit and finance working capital.

In 2011, the authority sold $254.73 million of bonds for the health-care system. Those bonds are due 2014 to 2023 with yields from 1.5% to 4%.

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