CHICAGO - The Illinois Finance Authority signed off on $650 million of borrowing planned by a handful of nonprofit hospitals and a college, including Northwestern Memorial Hospital, which plans to sell up to $475 million of fixed-rate bonds later this month.

Northwestern is tentatively scheduled to price its deal the week of March 23. The transaction would mark one of the largest from a health care borrower using a fixed-rate structure this year.

Nonprofit health care borrowers were frozen out of the fixed-rate market late last year, and while sector issuance is picking up, many borrowers looking at the spreads have preferred the lower rates seen on floating-rate structures.

Northwestern's director of finance, Francis Fraher, said the highly rated Chicago hospital prefers a fixed-rate structure as part of a strategy to shift more of its debt load to a fixed rate, which eliminates some of the market and interest rate risks borrowers have been grappling with over the last year. All of the hospital's nearly $800 million of debt is in variable-rate mode.

Proceeds of the sale would refund variable-rate bonds issued in 2008, 2007, 2004, 2002, and 1995. The deal also includes about $45 million of new money for various projects and an estimated $20.5 million to cover termination fees associated with swaps tied to the variable-rate bonds being refunded. Additional structural decisions, such as term and put features, will be made closer to the pricing date.

JPMorgan is senior manager and Citi is co-senior. Cabrera Capital Markets LLC and Loop Capital Markets LLC, both minority-owned firms, are co-managers. The IFA has asked its borrowers to increase their use of minority-and women-owned underwriters.

Kaufman Hall & Associates Inc. is financial adviser and Jones Day is bond counsel.

Northwestern carries ratings in the double-A category due to its prominent clinical reputation, excellent liquidity of $1.2 billion, and strong financial management.

The system had originally contemplated a fixed-rate issue in December to pay down a bank line of credit that retired insured variable-rate bonds and auction-rate securities and to restructure other auction-rate and floating-rate debt, but decided at the time that rates were too costly for a credit of its caliber. The hospital held off on the deal until January when $200 million was sold in a variable-rate.

The IFA board also gave final approval to the Rehabilitation Institute of Chicago's plans to sell up to $48 million to refund some outstanding debt and raise $28 million to finance the acquisition of land near its current Chicago campus that would house a future replacement facility.

The variable-rate bonds would carry a letter of credit from JPMorgan Chase NA. JPMorgan is the underwriter and Sonnenschein Nath & Rosenthal LLP is bond counsel. The bonds are expected to price later this month or next month.

The board also approved Winfield-based Central DuPage Health's new-money issue of up to $100 million. The hospital is spending $300 million for projects that include a new five-story bed pavilion, a cancer center, and garage.

The hospital intends to use a fixed-rate structure. It carries AA ratings from Fitch Ratings and Standard & Poor's. Morgan Stanley is senior manager and Jones Day is bond counsel.

The IFA also announced the departure of public finance veteran Karen Walker, who has served as its director of financial services since November 2007. Walker, a former municipal banker who has worked at Banc of America Securities LLC and the former A.G. Edwards & Sons Inc., is expected to be approved as chief financial officer of the Chicago Transit Authority at its board meeting today.

The IFA also recently lost Dana Sodikoff, a project funding manager. She joined Fitch as an associate director in the agency's Chicago office last month.

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