Prices of top-rated municipal bonds closed weaker on Tuesday as the state of Georgia sold about $1.3 billion of general obligation bonds in the primary market.
The Peach State's offerings consisted of five separate sales and were won by three different bidders.
Citi won the $279.15 million of Series 2015C GO refunding bonds with a true interest cost of 1.02%. The bonds were priced to yield from 0.28% with a 5% coupon in 2016 to 1.55% with a 2% coupon in 2020.
Citi also won the $265.10 million of Series 2015B taxable GOs, Tranche 1, with a TIC of 2.48%. The bonds were priced at par to yield from 0.30% in 2016 to 3.13% in 2025.
And Citi took the $288.03 million of Series 2015A GOs, Tranche 2, with a TIC of 3.38%. The bonds were priced to yield from 2.45% with a 5% coupon in 2026 to 3.58% with a 3.50% coupon in 2035.
Goldman Sachs won the $275.32 million of Series 2015A general obligation bonds, Tranche 1, with a TIC of 1.8189%. The bonds were priced as 5s to yield from 0.19% in 2016 to 3.34% in 2025.
Wells Fargo Securities won the $182.73 million of Series 2015B taxable GOs, Tranche 2, with a TIC of 4.11%. The bonds were priced to yield from 3.32% with a 3.625% coupon in 2026 to 4.00% with a 4.25% coupon in 2030; a 2035 maturity was priced at par to yield 4.15%.
Ahead of the sale, Moody's Investors Service, Standard & Poor's and Fitch Ratings affirmed the state's triple-A ratings.
Public Resources Advisory Group was the state's financial advisor. Holland & Knight was bond counsel and Kutak Rock was disclosure counsel.
The last time the Peach State sold comparable bonds in the competitive market was on June 17, 2014, when Wells Fargo Securities won $329.25 million of Series 2014A GOs, Tranche 1, with a TIC of 1.63%.
Since 1995, Georgia has issued about $21 billion of bonds, with the most issuance occurring in 2006 and 2009 when the state sold $1.7 billion and $2.5 billion, respectively. The state issued the least amount of bonds in 1996 and 2008 when it sold $496 million and 532 million, respectively.
JPMorgan on Tuesday priced Maricopa County, Ariz.'s $184.95 million of Series 2015 certificates of participation. The COPs were priced as 3s and 5s to yield 0.96% in a split 2017 maturity and as 3s and 5s to yield 1.35% in a split 2018 maturity. The issue was rated Aa1 by Moody's and AA-plus by S&P and Fitch.
RBC Capital Markets priced Miami-Dade County, Fla.'s $537.68 million deal for retail investors on Tuesday ahead of the institutional pricing on Wednesday.
The $499.12 million of Series 2015A aviation revenue and refunding bonds, subject to the alternative minimum tax, were priced to yield from 1.30% with a 5% coupon in 2017 to 4.42% with a 4.25% coupon in 2036; a 2038 maturity was priced as 5s to yield 4.21% and a 2045 maturity was priced as 4 1/2s to yield 4.61%. A 2016 maturity was offered as a sealed bid.
The $38.57 million of Series 2015B non-AMT aviation revenue refunding bonds were priced as 5s to yield 2.93% in 2025, 3.11% in 2026 and 3.27% in 2027. The deal was rated A by S&P and Fitch and AA-minus by Kroll Bond Rating Agency.
"We are trying to restructure our debt," Frank Hinton, Director of Miami-Dade's Division of Bond Administration, told The Bond Buyer. "We are projecting around $16.6 million in net present value savings from the refunding portion of this sale."
Secondary Market
The yield on the 10-year benchmark muni general obligation on Tuesday closed up one basis point to 2.36% from 2.35% on Monday, while the yield on the 30-year GO rose two basis points to 3.33% from 3.31%, according to the final read of Municipal Market Data's triple-A scale. Trading was light, according to Interactive Data.
Since the start of the month, yields on the 10-year muni are up by 14 basis points while the 30-year muni yield is also up by 14 basis points.
Treasury prices were lower as well on Tuesday with the yield on the two-year Treasury note rising to 0.70% from 0.68% on Monday, while the 10-year yield increased to 2.41% from 2.38% and the 30-year yield rose to 3.15% from 3.10%.
The 10-year muni to Treasury ratio was calculated on Tuesday at 97.6% versus 98.8% on Monday, while the 30-year muni to Treasury ratio stood at 105.7% compared to 106.7%, according to MMD.
