Municipal bonds finished flat on Wednesday as traders saw the last of this week’s big deals hit the screens.
Secondary market
The yield on the 10-year benchmark muni general obligation was unchanged from 1.97% on Tuesday, while the 30-year GO yield was flat from 2.82%, according to the final read of Municipal Market Data's triple-A scale.
U.S. Treasuries were slightly stronger on Wednesday. The yield on the two-year Treasury dipped to 1.30% from 1.31% on Tuesday as the 10-year Treasury yield dropped to 2.26% from 2.28% while the yield on the 30-year Treasury bond decreased to 2.93% from 2.94%.
The 10-year muni to Treasury ratio was calculated at 87.0% on Wednesday, compared with 86.3% on Tuesday, while the 30-year muni to Treasury ratio stood at 96.2%, versus 95.8%, according to MMD.
MSRB: Previous session's activity
The Municipal Securities Rulemaking Board reported 40,590 trades on Tuesday on volume of $11.05 billion.
Primary market
In the competitive arena on Wednesday, the San Francisco Municipal Transportation Agency sold $177.83 million of Series 2017 revenue bonds.
Wells Fargo Securities won the bonds with a true interest cost of 3.33%.
The issue was priced to yield from 0.72% with a 5% coupon in 2018 to 3.31% with a 4% coupon in 2042. A 2046 maturity was priced as 4s to yield 3.39% and a 2047 maturity was priced as 3 1/2s to yield approximately 3.568%.
The deal is rated Aa2 by Moody’s Investors Service and AA by S&P Global Ratings.
In the negotiated sector, Piper Jaffrey priced and repriced the Mayor and City Council of Baltimore’s Convention Center Hotel, Md.’s $268.76 million of Series 2017 revenue refunding bonds.
The issue was repriced to yield from 1.31% with a 3% coupon in 2018 to 3.70% with a 5% coupon in 2036. A 2039 maturity was priced as 5s to yield 3.73%, a 2042 maturity was priced as 5s to yield 3.75% and a 2046 maturity was priced as 5s to yield 3.78%.
The deal is rated BBB-minus by S&P.
JPMorgan Securities priced and repriced the Philadelphia Authority for Industrial Development, Pa.’s $179.08 million of Series 2017 hospital revenue bonds for the Children’s Hospital of Philadelphia.
The issue was repriced to yield from 0.92% with a 3% coupon in 2018 to 3.48% with a 4% coupon in 2037.
The deal is rated Aa2 by Moody’s and AA by S&P.
Stifel priced the California Pollution Control Financing Authority’s $220 million of Series 2017 solid waste disposal revenue green bonds for the CalPlant 1 project. The issue is not rated.
Pricing details were not available.
Since 2007, the California PCFA has sold about $2.79 billion of securities, with the most issuance occurring in 2012 when it sold $828 million. The authority did not come to market in 2013 and has sold under $100 million four times over the past 10 years.
Morgan Stanley priced and repriced the Mississippi Development Bank’s $100.75 million of Series 2017 special obligation bonds for the Rankin County School District general obligation bond project.
The issue was priced to yield from 1.23% with a 5% coupon in 2021 to 3.09% with a 5% coupon in 2040; a 2042 maturity was priced as 3 1/2s to yield 3.75%.
The deal is rated AA by S&P.
Morgan Stanley also priced Atlantic City, N.J.’s $71.34 million of Series 2017A tax appeal refunding bonds. The bonds were qualified pursuant to the provisions of the Municipal Qualified Bond Act, P.L. 1976 C.38 as amended.
The issue was priced as 5s to yield from 2% in 2020 to 3.40% in 2027, 3.62% in 2032, 3.88% in 2037 and 3.96% in 2042.
The deal is rated Baa1 by Moody’s and is insured by Build America Mutual and rated AA by S&P which has an underlying rating of BBB-plus on the credit.
Since 2007, the city has issued about $400 million of bonds with the most issuance occurring in 2012 when it sold $114.2 million of debt. The city did not come to market in 2014 or 2016.
