Municipals improve as new issues are well-received; Massachusetts brings $419.26 million bonds

By Sheri Kasprzak

New York, May 8 - Municipal yields were stronger on Tuesday as new issues came to market and were well-received by investors, traders said.

Yields were better by 2 basis points to 5 bps across the curve, market insiders said, as some of the week's larger deals priced.

"The calendar is pretty light, so everything is getting snapped up pretty quickly," said one trader during the afternoon.

"We're seeing yields firmer pretty much across the curve."

Heading up the primary activity during the session, the Commonwealth of Massachusetts brought $419.26 million of series 2012A commonwealth transportation fund revenue bonds to market, said a pricing sheet.

The rest of the week will be fairly light, with revised new issue estimates seen at about $5 billion for the week, down from the $6.4 billion seen late last week.

Massachusetts bonds

The bonds (Aaa/AAA/) out of Massachusetts were sold competitively with J.P. Morgan Securities LLC winning the bid.

The bonds are due 2013 to 2036 with term bonds due in 2040 and 2041. The serial coupons range from 2% to 5%. The 2040 bonds have a 3.75% coupon priced at 100.379. The 2041 bonds have a 4% coupon priced at 102.286.

"The bonds are secured by various taxes and fees, primarily relating to fuel and motor vehicle registration," said Alan Schankel, managing director with Janney Montgomery Scott LLC.

Proceeds will be used to finance bridge-related capital expenditures for the commonwealth.

Knoxville brings G.O.s

In other primary news, the City of Knoxville, Tenn., came to market with $92,855,000 of series 2012 general obligation bonds, said a pricing sheet.

The bonds (Aa1/AA+/AAA) were sold competitively with Wells Fargo Bank, NA winning the bid with a 1.93% true interest cost, said Jim York, the director of finance for the city.

"The city is required to issue new money on a competitive basis," York said in an interview.

"Refundings may be done on a negotiated basis, but our preference was to issue competitively."

The bonds are due 2013 to 2025 with 1% to 5% coupons. The 2014 and 2015 bonds were not reoffered.

Proceeds will be used to refund the city's series 2002A and 2004A-B G.O. 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.