New York City plans to sell $1.2 billion of general obligation bonds in October.
The city will hold a two-day retail period beginning Sept. 28. In that sale, New York intends to price $525 million of tax-exempt, fixed rate, new money bonds and $300 million of refunding bonds, as well as a $60 million conversion of variable rate demand bonds.
Book-running senior manager J.P. Morgan will lead the sale. Bank of America Merrill Lynch, Citigroup, Morgan Stanley and Siebert Brandford Shank & Co. LLC are co-senior managers.
According to Comptroller John Liu, 2012 is the bicentennial of the city’s first debt sale.
“Buyers appreciate our financial strength and commitment to our investors. Right now, there is a strong market for New York paper,” said Liu. “We have a loyal buying base for the GO credit, and haven’t been in the market with GOs since late spring, so we anticipate excellent demand.”
Moody’s Investors Service rates the city’s GO Bonds Aa2, while Fitch Ratings and Standard & Poor’s rate them AA.
New York sold $997 million of tax-exempt and taxable refunding GO bonds in May, an increase of $150 million from its original amount. It also sold $47 million in taxable bonds. BofA Merrill Lynch led the sale.
The city is appealing a state Supreme Court ruling in August that struck down its plans to expand yellow taxi service into all five boroughs, a ruling that could blow a $1.4 billion hole in the $68.5 billion budget it passed two months earlier.
Some critics said the city’s budget overly relied on one-shot items that included the expected amount from the sale of 1,800 new taxi medallions.
New York also expects to price $325 million of tax-exempt VRDBs around Oct. 23.