CHICAGO – Fighting headwinds from a downgrade and headlines over failed pension reform efforts, Illinois postponed Wednesday’s planned competitive sale of $500 million of general obligation bonds over concerns it would pay too steep an interest rate penalty.

“The indications were a lot wider and a bit higher than we anticipated so we felt it was prudent to pull the deal,” state capital markets director John Sinsheimer said of the spreads he was expecting in broker-dealer bids. “We were hearing that investors were still reacting to the rating agency actions and wanted to give the market more time to digest the news and settle down a bit.”

Subscribe Now

Independent and authoritative analysis and perspective for the bond buying industry.

14-Day Free Trial

No credit card required. Complete access to articles, breaking news and industry data.