Municipals round out session flat as new issues hit market; New York City Water brings bonds

By Sheri Kasprzak

New York, March 31 – Municipals closed Tuesday mostly flat, traders said, as the first few offerings of the short week priced.

Yields were little moved in spite of an improved Treasuries market, said a trader.

“Trading is light, and it almost feels like we’re in a summer mode with the holiday coming up,” he noted.

Yields on Treasuries, however, were lower with the five-year yield falling by about 4 basis points and the 10-year yield down 2 bps.

New York Water bonds price

Heading up the day’s primary action, the New York City Municipal Water Finance Authority priced $450,285,000 of series 2015GG water and sewer system second general resolution revenue bonds.

Raymond James/Morgan Keegan was the senior manager for the bonds.

The bonds are due 2025 to 2039 with 3.125% to 5% coupons, according to a term sheet.

Proceeds will be used to finance capital improvements and extensions to the city’s water and sewer system.

Bio-Agro deal sold

Elsewhere during the day, the Kansas Development Finance Authority hit the market with $202,535,000 of series 2015G Bio- and Ago-Defense facility revenue bonds.

The bonds (Aa3/AA-/) were issued through Morgan Stanley & Co. LLC.

The bonds are due 2018 to 2035 with 4% to 5% coupons, said a term sheet.

Proceeds will be used to finance a gift to Kansas State University in Manhattan to construct a Bio- and Agro-Defense facility as part of a partnership with the Department of Homeland Security.

The facility, which was slated to be fully operational by 2015, will replace the Plum Island Animal Disease Center in New York as a research facility under the DHS in cooperation with the U.S. Department of Agriculture’s Research Service and Animal Plant Health Inspection Service, Veterinary Services. Construction began in 2013, but the facility is not yet fully functional.

Kentucky power bonds higher

Looking to the day’s secondary action, the Kentucky Municipal Power Agency’s series 2015A bonds were seen in play.

The 4% 2039s were trading at par at the end of the day Tuesday after pricing to yield 4.14% on March 17.

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