Markets

Large taxable deals fare well while gilt-edged Delaware yields track in line with AAA benchmarks in competitive deal.

The high-demand market environment boosted Philadelphia’s first general obligation bond deal of 2020.

Whether new dedicated revenue for the MTA or its higher total debt holds more sway in the capital markets remains an open question.

After returning north of 7% in 2019, the municipal bond asset class continues to see strong returns so far in 2020.

The top municipal bond counsel saw $265.58 billion of business in the first three quarters of 2019, up from $237.49 billion a year earlier. Orrick Herrington & Sutcliffe LLP once again found itself on top with Hawkins Delafield and Wood gaining some ground.

The two active municipal bond insurers insured $5 billion more in 2019 than they did in 2018 thanks to a surge of issuance in the fourth quarter. Assured Guaranty and Build America Mutual combined for $23.92 billion of insured volume spanning 1,724 transactions and 5.67% penetration rate in 2019. That is up from $18.92 billion in 1,249 deals and 5.58% insured rate in 2018.

While the general feeling is the Federal Reserve will keep rates steady this year, not everyone is on board with that view.

The municipal bond market will see a several large hospital corporate CUSIP taxable deals priced this week. Partners HealthCare Mass General, Cottage Health and Hartford HealthCare top a $7 billion calendar. Just what the doctor ordered for supply-starved buyers.

Chicago’s $1.5 billion sale of general obligation refunding bonds and Sales Tax Securitization Corp. debt generated $310 million of budget savings.

Although municipal bond volume is expected to rise by almost $2 billion, it won’t be nearly enough to satisfy investors’ thirst for the asset class.