Prices of top-shelf municipal bonds were lower at mid-session, traders said, as yields on some maturities were up by as much as two basis points.
In the primary market, the big Trinity Health and Santee Cooper deals priced in the negotiated sector while the Maryland Department of Transportation sold $280 million of consolidated transportation bonds in the competitive arena.
Primary Market
Citigroup Global Markets won the Maryland DOT bonds with a true interest cost of 2.5635%. The bonds were priced to yield from 0.68% with a 5% coupon in 2018 to 2.87% with a 4% coupon in 2030. The issue is rated Aa1 by Moody's Investors Service, AAA by Standard & Poor's and AA-plus by Fitch Ratings.
In the negotiated sector, Barclays Capital priced South Carolina Public Service Authority's $957.045 million of Series 2015 revenue obligations for Santee Cooper. The issue is rated A1 by Moody's, AA-minus by S&P and A-plus by Fitch.
The Series A $450.01 million tax-exempt refunding and improvement bonds were priced to yield from 0.48% with a 3% coupon in 2016 to 0.76% with a 3% coupon in 2017; from 1.28% with a 5% coupon in 2019 to 1.83% with a 5% coupon in 2021; from 2.30% with a 5% coupon in 2023 to 2.82% with a 5% coupon in 2026; as 5s to yield 3.10% in 2029; from 3.20% with a 5% coupon in 2031 to 3.80% with a 3.625% coupon in 2037; a split 2040 maturity was priced as 3 3/4s and as 4s to each yield 3.92%; a split 2045 maturity was priced at par to yield 4% and as 5s to yield 3.59%; a 2050 maturity was priced as 5s to yield 3.89%; and a 2055 maturity was priced as 5s to yield 4%.
The Series B $64.935 million tax-exempt refunding bonds were priced as 5s yield from 2.13% in 2022 to 2.55% in 2024. The Series C $272 million tax-exempt refunding bonds were priced as 5s to yield from 0.98% in 2016 to 2.53% in 2022. The Series D $169.72 million taxable bonds were priced at par to yield 0.425% in 2045.
And after pulling the plug and deciding not to go to market when scheduled last week due to unfavorable market conditions, Trinity Health Credit Group came to market with a composite issue $894.76 million that is separated into three series.
The first series was for the Michigan Finance Authority. The Series 2015MI $561.61 million hospital revenue and refunding bonds were priced to yield from 0.60% with a 5% coupon in 2016 to 3.37% with a 5% coupon in 2035; a 2038 split maturity was priced as 4s to yield 4.04% and as 5s to yield 3.44%. The 2015 maturity was offered as a sealed bid.
The second series was for the Idaho Health Facilities Authority. The $171.69 million Series 2015ID revenue bonds were priced to yield from 0.48% with a 3% coupon in 2015 to 3.29% with a 5% coupon in 2033.
The last series was for Montgomery County, Md. The $161.46 million Series 2015MD revenue bonds, were priced in a 2044 split maturity as 4s to yield at 3.98% and as 5s to yield at 3.38%.
The issue was rated Aa3 by Moody's, AA-minus by S&P and AA by Fitch.
Secondary Market
At midday, the yield on the 10-year benchmark muni general obligation was up as much as two basis points from 2.02% on Tuesday, while the yield on 30-year GOs was as much as two basis points higher from 2.84%, according to a read of Municipal Market Data's triple-A scale.
Since the start of the month, the yield on the muni 10-year benchmark general obligation is up by 28 basis points, while yield on the 30-year GO is 34 basis points higher, according to MMD.
Treasury prices were lower on Wednesday. The two-year note yield rose to 0.66% from 0.65% on Tuesday, while the 10-year yield increased to 2.01% from 1.98% and the 30-year yield rose to 2.60% from 2.56%.
On Tuesday, the 10-year muni to Treasury ratio was calculated at 101.6% from 100.9% on Monday, while the 30-year muni to Treasury ratio stood at 110.5 compared to 110.1%.
Bond Buyer Visible Supply
The Bond Buyer's 30-day visible supply calendar fell $1.103 billion to $9.718 billion on Wednesday. The total is comprised of $2.065 billion competitive sales and $7.652 billion of negotiated deals.
MSRB Reports Previous Session's Activity
The Municipal Securities Rulemaking Board reported 36,795 trades on Tuesday on volume of $8.563 billion. Most active on Tuesday, based on the number of trades, was the Wayne County Building Authority, Mich., 2010 taxable jail 10s of 2040, which traded 198 times with an average price of 97.403, an average yield of 10.287%.
