The Regional Transportation District of Colorado lured yield-hungry investors Thursday with a sale of $429.6 million of certificates of participation.
Yields ranged from 2.85% with a 5% coupon in 2023 to a 4.50% coupon in 2044 at par. The bonds are callable at par in 2023. The sinking fund schedule consists of two term bonds in both 2039 and in 2044.
"Pricing the headline deal of the week is Colorado RTD," said Sean Carney, municipal bond strategist at BlackRock. "Now granted this is a little less of a credit, AA3 and single-A cops, but again the long bonds are pricing at a 4.13% that tax-adjusts up to a 7.30%. They're very attractive yields in today's low rate environment."
The largest long term bond deal of the week was led by JP Morgan Securities and was rated Aa3 by Moody's Investors Service, and A by both Standard & Poor's and Fitch Ratings.
Muni yields, after weakening Wednesday on concern over a glut in supply, held steady as investors snapped up the RTD COPs and several of the other largest issues of the week.
Citigroup Global Markets priced $325 million of Long Beach, Calif., short term revenue notes Thursday. Yields ranged from 1.01% with a 3% coupon in 2018 to 1.01% with a 5% coupon in 2018 without a call option. The deal is rated AA by both S&P and Fitch.
Barclay's Capital priced $278.5 million of Austin, Texas Water and Wastewater system revenue refunding bonds.
Yields ranged from 1.03% with a 5% coupon in 2018 to 3.74% with a5% coupon in 2043. The bonds are callable at par in 2024 with term bonds maturing serially from 2028 to 2034. There is also a term both in both 2039 and 2043.
The deal is rated Aa2 by Moody's, AA by S&P and AA-minus by Fitch.
Mesirow Financial priced a four-part deal totaling $190.6 million of Chicago Park District limited tax GOs.
Yields on 78.3 million ranged from 0.24% with a 2% coupon in 2015 to 3.48% with a 5% coupon in 2029;yields on $45.9 million ranged from 0.68% with a 5% coupon in 2017 to 3.87% with a 5% coupon in 2033; and yields on $40.4 million ranged from 3.87% with a 5% coupon in 2033 to 4.05% with a 5% coupon in 2039. These three series are callable at par in 2024.
Yields on $26 million ranged from 0.72% with a 3% coupon in 2016 to 2.61% with a 5% coupon in 2021 without a call option. The entire deal received an AA-plus rating from S&P and an AA-minus rating by Fitch.
Bank of America Merrill Lynch priced a four-part deal totaling $140.3 million of Los Angeles County Regional Financing Authority mortgage loan insurance.
The $45 million entrance fee redemption bond has a 1.27% yield with a 2.50% coupon in 2020 and is callable at par in 2015. Yields for $44.8 million ranged from 1.57% with a 3% coupon in 2019 to 4.03% with a 5% coupon in 2044. The bonds are callable at par in 2022 with term bonds in 2034 and 2044.
The $25 million series has a 1.87% yield with a 3% coupon maturing in 2021. The second series of $25 million has a 1.45% yield with a 3% coupon in 2020. Both series are callable at par in 2015. The deal received an A rating from both S&P and Fitch.
Loop Capital Markets priced $105 million of Chicago, Il., motor fuel tax revenue refunding bonds. Yields ranged from 0.295% with a 2% coupon in 2015 to 4.180% with a 5% coupon in 2033. The bonds are callable at par in 2024. The deal is rated Baa1 by Moody's, AA-plus by S&P and BBB-plus by Fitch.
Bank of America Merrill won the bid for $273.8 million of Metro Atlanta Rapid Transit Authority revenue bonds, the largest deal in the competitive market this week.
"For a transportation system, it's historically been trading weaker in general, but has improved over time. It should offer a little bit of incremental yield over higher-grade Georgia bonds," a trader in Virginia said.
Yields ranged from 1.91% with a 5% coupon in 2021 to 4% with a 4% coupon in 2044. The bonds are callable at par in 2023. The deal is rated AA-plus by S&P and AA-minus by Fitch.
Wells Fargo Securities received the award for $200 million of Kern, County, Calif. tax and revenue anticipation notes. The deal is rated SP-1+ by S&P.
Munis were steady across the curve, according to the Municipal Market Data's triple-A scale. The 30-year yield, the 10-year benchmark and the two-year note held steady, according to Municipal Market Advisor's 5% triple-A scale.
Treasuries mostly strengthened Thursday, with the 10-year benchmark and the two-year falling two basis points each to 2.59% and 0.38%, respectively. The 30-year yield inched up one basis point to 3.44%.
Secondary market trading showed mostly weakening, according to data provider Markit.
California Tobacco Securitization Corp. revenue bonds with a 5% coupon maturing in 2033 climbed five basis points to 6.73%, and the New Jersey Tobacco Settlement Funding Corp. asset-backed bonds with a 5% coupon in 2041 inched up two basis points to 6.77%.
New York Metropolitan Transportation Authority revenue bonds with a 5% coupon in 2043 rose one basis point to 3.99%, and the New Jersey Transportation Trust Fund Authority bonds with a 5% coupon in 2042 advanced one basis point to 4.06%.
