Connecticut says bond sale achieved record low interest rate

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The most recent of three Connecticut bond sales achieved a record-low interest cost of 2.31%, according to state Treasurer Shawn Wooden.

Combined orders from both retail and institutional investors exceeded $4 billion for the planned $400 million sale of tax-exempt general obligation bonds on June 11. More than $430 million of orders came in during the one-day retail period.

Morgan Stanley led the borrowing syndicate for this sale.

“Despite the earlier market upheaval from the global pandemic, we successfully navigated the waters on all three of these bond sales, receiving high investor demand and lower interest costs on our bonds,” Wooden said.

“Despite the earlier market upheaval from the global pandemic, we successfully navigated the waters on all three of these bond sales," said Connecticut Treasurer Shawn Wooden.

Proceeds will fund grants-in-aid to various not-for-profit health and human services providers; infrastructure improvements throughout the higher-education system; wastewater treatment upgrades at the Metropolitan District Commission’s water pollution control facilities; housing and water projects; water and drinking water projects; and a variety of other priorities.

The final three sales of the fiscal year totaled $1.75 billion. Besides the $400 million deal, Connecticut priced $850 million of special tax obligation transportation infrastructure bonds on May 19, which attracted more than $480 million in retail orders. The $500 million offering of taxable GOs on May 28 achieved a 2.43% borrowing cost for the 10-year bonds.

Separately, Wooden at last week’s meeting of the Investment Advisory Council, announced a $100 million commitment to both Stellex Capital Partners Fund II, which will focus on special situations and distressed investments, and Leeds Capital Partners Fund VII, which will pursue control-oriented private equity investments in the education, training and information services sectors.

Wooden also said the largest three plans within the Connecticut Retirement Plans and Trust Funds — the State Employees’ Retirement Fund, the Teachers’ Retirement Fund and the Municipal Employees’ Retirement Fund — beat their respective benchmarks for April by more than 35 basis points, with returns for each exceeding 5.2%.

The treasurer also announced the four finalist firms in the emerging market debt fund competitive search process: Aberdeen Standard Investments, Eaton Vance Management, Payden & Rygel and PIMCO.

Connecticut on Wednesday is scheduled to begin the second phase of its reopening. Gov. Ned Lamont said about 95% of the state’s economy will be able to be operational. The state will limit capacity for most businesses to 50%.

Businesses that may reopen include amusement parks; hotels and other lodging; indoor dining; and indoor museums, zoos and aquariums.

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Connecticut Sell side Shawn Wooden Ned Lamont Coronavirus Infrastructure Primary bond market
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