New Jersey Trans­porta­tion Deal In­creased to Meet De­mand

The Bond Buyer - - Market News - By Chip Bar­nett & aaron Weitz­man

Good in­vestor de­mand met the the new deals that priced in the pri­mary on Wednesday even as mu­nis re­mained mostly weaker.

Wells Fargo Se­cu­ri­ties priced and repriced and re­struc­tured the New Jersey Trans­porta­tion Trust Fund Au­thor­ity’s $750 mil­lion of Se­ries 2019AA trans­porta­tion pro­gram bonds.

Buyer in­ter­est prompted the deal to be in­creased in size from the orig­i­nal $500 mil­lion is­sue.

“De­mand was good on the long end, al­low­ing them to up­size,” said one source who par­tic­i­pated in the deal.

The deal is rated Baa1 by Moody’s In­vestors Ser­vice, BBB-plus by S&P Global Ratings, and A-mi­nus by Fitch Ratings and Kroll Bond Rat­ing Agency. All four rat­ing agen­cies as­sign sta­ble out­looks to the credit.

Since 2009, the au­thor­ity has sold about $16 bil­lion of bonds with the most is­suance oc­cur­ring in 2018 when it is­sued

$2.76 bil­lion. It did not come to mar­ket in 2017.

Gold­man

Sachs priced the

Trin­ity Health

Credit Group’s

$348.22 mil­lion com­pos­ite is­sue.

Cit­i­group priced the In­di­ana Fi­nance Au­thor­ity’s $212.23 mil­lion of Se­ries 2019A state re­volv­ing fund pro­gram green bonds.

The deal is rated triple-A by Moody’s, S&P and Fitch; all three agen­cies as­sign sta­ble out­looks to the credit.

In the com­pet­i­tive sec­tor, Citi won the Florida Depart­ment of Trans­porta­tion’s $224.17 mil­lion of Se­ries 2019A turn- pike rev­enue re­fund­ing bonds.

The deal is rated Aa2 by Moody’s and AA by S&P and Fitch.

On Thursday, JPMor­gan Se­cu­ri­ties is ex­pected to price the San Fran­cisco Air­port Com­mis­sion’s $1.78 bil­lion of tax-exempt and tax­able rev­enue and rev­enue re­fund­ing bonds.

The deal, which con­sists of bonds sub­ject to the al­ter­na­tive min­i­mum tax and non-AMT bonds, is rated A1 by Moody’s and A-plus by S&P and Fitch.

The New York City Mu­nic­i­pal Wa­ter Fi­nance Au­thor­ity said Wednesday that it plans to sell $450 mil­lion of tax-exempt fixed-rate sec­ond gen­eral res­o­lu­tion rev­enue bonds on Wednesday, Jan. 16 af­ter a one-day re­tail or­der pe­riod.

Pro­ceeds will be used to fund cap­i­tal projects.

The bonds will be sold via ne­go­ti­ated sale through the au­thor­ity’s un­der­writ­ing syn­di­cate, led by book-run­ning lead man­ager Bar­clays, with Ray­mond James and Siebert Cis­neros Shank & Co. serv­ing as co-se­nior man­agers.

The Bond Buyer’s 30-day vis­i­ble sup­ply cal­en­dar de­creased $1.58 bil­lion to $9.58 bil­lion for Wednesday. The to­tal is com­prised of $3.03 bil­lion of com­pet­i­tive sales and $6.55 bil­lion of ne­go­ti­ated deals.

Mu­nic­i­pal bonds were mostly weaker on Wednesday, ac­cord­ing to a late read of the MBIS bench­mark scale. Bench­mark muni yields fell as much as three ba­sis points in the one- to six-year ma­tu­ri­ties, rose as much as one ba­sis point in the eight- to 30-year ma­tu­ri­ties and were un­changed in the seven-year ma­tu­rity.

High-grade mu­nis were also mostly weaker, with yields cal­cu­lated on MBIS’ AAA scale fall­ing as much as one ba­sis point in the one- to 10-year ma­tu­ri­ties and ris­ing as much as one ba­sis point in the 11- to 30-year ma­tu­ri­ties.

Mu­nic­i­pals were weaker on Mu­nic­i­pal Mar­ket Data’s AAA bench­mark scale, which showed the yield on the 10-year muni gen­eral obli­ga­tion ris­ing one ba­sis point while the yield on the 30-year muni ma­tu­rity gained three ba­sis points.

Trea­sury bonds were mixed amid stock mar­ket volatil­ity. The Trea­sury 30-year was yield­ing 3.022%, the 10year yield stood at 2.728%, the fiveyear was at 2.554%, the two-year was at 2.549% while the Trea­sury three-month bill stood at 2.443%.

On Wednesday, the 10-year muni-to-Trea­sury ra­tio was cal­cu­lated at 81.8% while the 30-year muni-to-Trea­sury ra­tio stood at 101.0%, ac­cord­ing to MMD. The Mu­nic­i­pal Se­cu­ri­ties Rule­mak­ing Board re­ported 45,200 trades on Tuesday on vol­ume of $10.34 bil­lion.

Cal­i­for­nia, New York and Texas were the mu­nic­i­pal­i­ties with the most trades, with the Golden State tak­ing 17.232% of the mar­ket, the Em­pire State tak­ing 10.158% and the Lone Star State tak­ing 9.001%. ◽

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