Municipals rally with Treasuries; New York Transitional Finance prices bonds to strong demand

By Sheri Kasprzak

New York, Jan. 14 – The municipals market was stronger Wednesday, market insiders said, as Treasuries rallied and yields on New York City Transitional Finance Authority’s building aid revenue bonds were lowered.

Yields were seen lower by 3 basis points to 4 bps, said a trader in the afternoon.

Meanwhile, weak retail sales data for December sent Treasuries into a rally, with the 30-year bond yield falling to a record low of 2.47%. The 10-year Treasury note yield fell by 5 bps.

NYC Transitional bonds price

Heading up primary action, the New York City Transitional Finance Authority hit the market with $750 million of series 2015S-1 building aid revenue bonds, the largest reported offering of the week so far.

The bonds were sold through senior managers Ramirez & Co. Inc. and Goldman Sachs & Co.

The bonds are due 2016 to 2037 with term bonds due in 2040, 2043 and 2044. The serial coupons range from 3% to 5%. The 2040 bonds have a 5% coupon priced at 118.18. The 2043 bonds have a 5% coupon priced at 117.8, and the 2044 bonds have a 4% coupon priced at 106.348.

Proceeds will be used to finance certain authority building expenditures as part of its five-year capital plan.

Oregon DOT sells debt

Elsewhere during the session, the Oregon Department of Transportation offered up $383,145,000 of series 2015A tax-exempt highway user tax refunding revenue bonds.

The bonds were sold through senior managers Morgan Stanley & Co. LLC and Citigroup Global Markets Inc.

The bonds are due 2019 and 2022 and 2025 to 2033 with 4% to 5% coupons, according to a pricing sheet.

Proceeds will be used to refund existing highway user tax revenue bonds.

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