Municipal yields end week flat to slightly weaker; Illinois brings $250 million in G.O. bonds

By Sheri Kasprzak

New York, April 1 - No fooling, municipals ended a short week largely unchanged with some weakness seen on the short end of the yield curve.

"We're mostly flat overall, but yields are up on the short end, maybe 1 or 2 basis points," said one trader reached in the late afternoon.

"There's a few things trading out there, but it's pretty quiet overall. People are leaving early or are out altogether already."

Amid the light trading, the California State Public Works Board's series 2010A-2 various-project bonds were moving. The 8% 2035 bonds were trading at 8.211%.

Elsewhere, the Rhode Island State Turnpike and Bridge Authority's series 2010A revenue bonds were trading. The 5% 2039s were seen at 4.923%.

Illinois sells $250 million

On the primary side, the State of Illinois priced $250 million in series of April 2010 general obligation bonds Thursday, said a pricing sheet.

The bonds (A2/A+/A) were sold competitively. J.P. Morgan Securities Inc. won the bid with a 1.02% true interest cost.

The 2.5% bonds, which are due March 31, 2011, were not reoffered.

Public Resources Advisory Group was the financial adviser.

Proceeds will be used to fund capital projects throughout the state.

Notes for Detroit schools price

Also in primary, the Michigan Municipal Bond Authority priced Thursday $256 million in series 2010B state aid revenue notes for the School District of the City of Detroit, said a pricing sheet.

The notes (/SP-1/F1) were sold on a negotiated basis with JPMorgan and Loop Capital Markets LLC as the senior managers.

The 5% notes are due March 21, 2011 and were priced at 100.09.

The authority plans to use the proceeds to purchase a note to be issued to Detroit's school district.

Delmarva Power bonds sold

Elsewhere, the Delaware Economic Development Authority priced Thursday $78.4 million in series 2010 gas facilities refunding revenue bonds for Delmarva Power & Light Co., said a form 8-K filed with the Securities and Exchange Commission.

The 5.4% bonds are due Feb. 1, 2031 and priced at par.

Morgan Stanley & Co. Inc. and KeyBanc Capital Markets were the senior managers.

Proceeds from the sale will be used to redeem the company's series 2000, 2001 and 2002 bonds.

Based in Wilmington, Del., Delmarva Power & Light is an electric and gas utility that serves Delaware, Maryland and Virginia.

Chicago to price airport bonds

Looking to upcoming offerings, the City of Chicago plans to price $1.167 billion in revenue bonds for Chicago O'Hare International Airport, said a preliminary official statement.

The deal is comprised of general airport third-lien bonds, which include $112.67 million in series 2010A non-AMT revenue bonds, $557.18 million in series 2010B Build America Bonds, $175.83 million in series 2010C non-AMT revenue bonds, $55.38 million in series 2010D revenue refunding bonds, $45.915 million in series 2010E revenue refunding bonds and $92.9 million in series 2010F non-AMT revenue bonds.

The offering also includes passenger facility charge bonds, including $41.345 million in series 2010A non-AMT bonds, $48.76 million in series 2010B non-AMT bonds, $21.95 million in series 2010C taxable bonds and $15.205 million in series 2010D refunding bonds.

The bonds (A1/A-/A) will be sold on a negotiated basis with Bank of America Merrill Lynch as the senior manager.

Proceeds will be used to refund commercial paper notes and fund the modernization of the airport.

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