Municipal yields slide by 2 to 4 bps; Chicago brings $246.54 million in bonds for airport

By Sheri Kasprzak

New York, Oct. 15 - Municipal yields closed out the week on a sour note, gaining 2 to 4 basis points with the long end of the curve taking the biggest hit, a trader said.

"The long end is probably up 4 or so basis points," said the trader.

"Elsewhere, maybe up 2 to 3 basis points. It's been really quiet today [in secondary]. Treasuries are weak, so we're weak."

Meanwhile, the City of Chicago brought to market $246.54 million in series 2010 revenue bonds for the Chicago Midway Airport, said a pricing sheet.

The sale included $84 million in series 2010B second-lien Build America Bonds, $63.47 million in series 2010C taxable bonds, $82.61 million in series 2010D-1 taxable bonds and $16.46 million in series 2010D-2 taxable bonds.

The 2010B bonds are due 2034 and have a 5% coupon priced at 110.154.

The 2010C bonds are due 2016 to 2025 with term bonds due 2030, 2035 and 2041. The serial coupons range from 3.782% to 6.009%. The coupon is 7.068% for the 2030 bonds, 7.118% for the 2035 bonds and 7.168% for the 2041 bonds.

The 2010D-1 bonds have a 3.532% coupon, and the 2010D-2 bonds have a 3.532% coupon. Both are due 2041.

All of the 2010C and 2010D bonds priced at par.

J.P. Morgan Securities LLC and Ramirez & Co. Inc. were the joint bookrunners.

Proceeds will be used to repay a portion of the airport's outstanding commercial paper notes and fund a debt service reserve account.

North Carolina bonds sold

Elsewhere, the North Carolina Turnpike Authority sold $233.92 million in series 2010 Monroe Connector state appropriation revenue bonds (Aa2/AA/) on Thursday, said a term sheet released Friday afternoon.

The bonds were sold through Bank of America Merrill Lynch.

The bonds are due 2022 to 2025 with term bonds due 2031 and 2041. The serial coupons range from 4.25% to 4.75%. The 2031 bonds have a 5.318% coupon, and the 2041 bonds have a 5.418% coupon. All of the bonds priced at par.

The authority intends to use the proceeds to construct the Monroe Connector, a 19.7-mile roadway extending from U.S. Highway 74 in Mecklenburg, N.C., at Interstate 485 to Highway 74 in Monroe, N.C.

D.C. preps TRANs deal

Looking to the coming week, new issue activity will pick up slightly, led by a $700 million competitive sale of series 2011 general obligation tax and revenue anticipation notes from the District of Columbia.

The sale is scheduled for Tuesday. Phoenix Capital Partners LLC and Public Resources Advisory Group are the financial advisers.

The notes are due Sept. 30, 2011, and proceeds will fund general governmental expenses ahead of the collection of revenues during fiscal year 2011.

UMass Building bonds set

Also during the coming week, the University of Massachusetts Building Authority plans to price $567.61 million in series 2010 project revenue bonds on Thursday, said a preliminary official statement.

The sale includes $126.335 million in series 2010-1 bonds, $438.255 million in series 2010-2 Build America Bonds and $3.02 million in series 2010-3 federally taxable bonds.

The 2010-1 bonds are due 2011 to 2020, and the 2010-2 bonds are due 2021 to 2040. The 2010-3 bonds are due 2011 to 2040.

The bonds (Aa2//AA) will be sold on a competitive basis with Public Financial Management Inc. as the financial adviser.

Proceeds will be used to finance improvements at the university's Amherst, Boston, Dartmouth and Lowell campuses.

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