Municipals close flat to firmer along with Treasuries; Los Angeles Water brings $527.3 million

By Sheri Kasprzak

New York, Feb. 21 - Municipals were mostly flat to slightly firmer on Thursday after getting off to a mixed start early in the session, according to market sources.

Things were a bit shaky early in the session, said one trader, but the tone rounded out the day somewhat firmer.

"We seem to be following Treasuries," he noted.

With most of the week's new offerings priced on Wednesday, supply pressure eased on Thursday.

"Despite the downward price move, the municipal market is aided by the multiple and diverse new issues pricings, including AAA states North Carolina and Delaware, with new issues offering guidance for the secondary market," said Alan Schankel, managing director with Janney Montgomery Scott LLC.

"As March 1 grows near, sequester is on the market's mind, generating uncertainty about reductions in payments to state and local governments as well as the impact of economic slowdown on sales and income taxes."

L.A. power bonds price

Heading up Thursday's primary action, the Los Angeles Department of Water and Power brought to market $527,315,000 of series 2013A power system revenue bonds, said a pricing sheet.

The bonds (Aa3/AA-/AA-) were sold through BofA Merrill Lynch and Morgan Stanley & Co. LLC.

The bonds are due 2013 to 2031 with 1% to 5% coupons.

Proceeds will be used to refund the department's series 2003A revenue bonds.

Delaware G.O. bonds cheapen

In other pricing action, the State of Delaware sold $336.33 million of series 2013 general obligation bonds, said a pricing sheet.

The deal included $111.33 million of series 2013A bonds and $225 million of series 2013B bonds.

The 2013A bonds are due 2017 to 2026 with 2% to 5% coupons. The 2013B bonds are due 2014 to 2033 with coupons from 2% to 5%.

Yields on many maturities were cheaper in repricing, said one trader reached in the afternoon following the initial pricing.

The bonds (Aaa/AAA/AAA) were sold through BofA Merrill Lynch and Raymond James/Morgan Keegan.

Proceeds will be used to finance capital facilities for the state, as well as to refund the state's series 2005D, 2006A-B, 2007A and 2011 G.O. bonds.

U of California deal set

Looking to upcoming offerings, the University of California announced Thursday that it intends to hit the market with $1,586,515,000 of series 2013 general revenue bonds through J.P. Morgan Securities LLC, Wells Fargo Securities LLC and BofA Merrill Lynch.

The offering will be conducted in three tranches: $800 million of series 2013AF bonds, $500 million of series 2013AG bonds and $286,515,000 of series 2013AH taxable fixed-rate notes.

Proceeds from the sale will be used to refund the university's series 2003A-B and 2005C-G general revenue bonds.

© 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.