Detroit's $500 million senior-lien water bond sale last week saw spreads as high as 178 basis points over the triple-A benchmark scale on the longer maturity serial bonds.

Yields on a piece of 2012 bonds were 0.83%. A 5% coupon bond that matures in 2036 and 2041 saw yields of 5.23% and 5.28%, or spreads of 160 and 161 basis points over the triple-A benchmark scale, according to Thomson Reuters.

Siebert Brandford Shank & Co. was the lead underwriter.

Standard & Poor's rated the bonds A-plus and Moody's Investors Service rated them A1.

The city will use the proceeds for capital projects at its water department and to terminate all 15 of the system's interest-rate swaps.

Swap termination payments are expected to total $210 million.

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