Top quality munis are stronger by as many as two basis points on some maturities through midday, according to traders.
The market has seen a bevy of deals priced including the Empire State Development Corp.'s four competitive sales that total $1.136 billion.
Primary Market
On Tuesday, the Empire State Development Corp. sold about $1.136 billion of personal income tax revenue bonds in four separate competitive sales for the New York State Urban Development Corp.
The offering consists of $400.375 million of Series 2015A Group B bonds; $386.275 million of Series 2015A Group A bonds; $237.215 million of Series 2015B taxable bonds; and $112.445 million of Series 2015A Group C bonds. All four sales are rated Aa1 by Moody's Investors Service and triple-A by Standard and Poor's.
The group 2015A Group B bonds were won by Bank of America Merrill Lynch with a true interest cost of 3.34%. The bonds were priced to yield from 2.26% with a 5% coupon in 2026 to 2.92% with a 5% coupon in 2035.
The group 2015A Group A bonds were won by Wells Fargo Securities with a TIC of 1.83%. No other pricing information was immediately available.
The group 2015B taxable bonds were won by JP Morgan with a true interest cost of 1.78%. No other pricing information was immediately available.
The 2015A Group C bonds were won by Jefferies LLC with a TIC of 3.98%. The bonds were priced to yield from 2.93% with a 5% coupon in 2036 to 3.07% with a 5% coupon in 2042. A 2045 term bond was priced to yield 3.10% with a 5% coupon.
The last time the ESDC competitively sold comparable tax-exempt bonds was on Dec. 2, 2014, when JPMorgan won $414.86 million of Series 2014A Group A PIT bonds with a TIC of 1.82%; ESDC last sold comparable taxable bonds on Dec. 2, 2014, when Goldman Sachs won $370.82 million of Series 2014B bonds.
Since 2005, the Empire State Development Corp. has issued about $15.03 billion of debt. The most issuance took place in 2009 and 2013 when the ESDC sold $2.55 billion and $3.28 billion of bonds, respectively. The low years occurred in 2006 and 2012, when it did not come to market at all. During the past 10 years, it has come to market with bonds an average of 4.1 times per year.
Wells Fargo Securities priced New York City Housing Development Corp.'s $197.33 million of Series H&I multi-family housing revenue sustainable neighborhood bonds. This issue, which has a mandatory tender maturity of 2020, is rated Aa2 by Moody's and AA-plus by S&P.
The $136.470 million series H bonds were priced at par in a bullet maturity to yield 2.90% in 2045, with a mandatory tender date of Feb. 1, 2026.
The $60.860 million series I bonds were priced as at par in a bullet maturity to yield 2.90% in 2045, with a mandatory tender date of Feb. 1, 2026.
BAML priced the Metropolitan Transportation Authority's $318.915 million of revenue refunding bonds, series 2015F for retail investors. The bonds are priced to yield from 0.85% with a 3% coupon in 2017 to 3.17% with a 5% coupon in 2036. No retail orders were taken in the 2027-2029 maturities or the 2031-2035 maturities. The deal is rated A1 by Moody's, AA-minus by S&P, A by Fitch Ratings and AA-plus by Kroll Bond Rating Agency.
BAML priced South Carolina Public Service Authority's $300 million of revenue obligation bonds, series E. The bonds were priced to yield 4.00% with a 5.25% coupon in a bullet maturity in 2055. The deal is rated A1 by Moody's, AA-minus by S&P and A-plus by Fitch.
Las Vegas, Nev., sold $164.425 million of Series 2015C GOLT City Hall bonds, additionally secured by pledged revenues. JP Morgan won the bidding with a TIC of 3.28%. No other pricing information was immediately available. The issue is rated Aa1 by Moody's and AA by S&P.
Secondary Market
On Tuesday afternoon, the yield on the 10-year benchmark muni general obligation was down by as much as one basis point from 1.99% on Monday, while the 30-year yield was down as much as two basis points from 2.92%, according to a read of Municipal Market Data's triple-A scale.
Treasury yields on Tuesday afternoon were mixed. The yield on the two-year Treasury rose to 0.94% from 0.93% on Monday while the 10-year Treasury yield was flat at 2.22% and the 30-year rose to 2.96% from 2.95%.
The 10-year muni to Treasury ratio was calculated on Monday at 89.6% from 88.4% on Friday, while the 30-year muni to Treasury ratio stood at 98.3% compared to 99.0%, according to MMD.
MSRB Previous Session's Activity
The Municipal Securities Rulemaking Board reported 32,718 trades on Monday on volume of $5.073 million.
