The New York City Transitional Finance Authority sold $1 billion in new money and refunding bonds, including $650 million in new money bonds, $250 million in refunding bonds -- both tax-exempt and fixed-rate --and $100 million in taxable qualified school construction bonds.
The TFA, which finances a portion of the city’s capital projects, received about $177 million of retail orders for the two-day retain period that preceded Wednesday’s sale. According to a spokesman for city Comptroller John Liu, strong investor demand made it possible to reduce yields by one basis point in the 2025 through 2034 maturities, and two basis points in the 2036 maturity.
Final yields on the tax-exempt, fixed-rate bonds varied by coupon and maturity, ranging from 0.17% in 2013 to 3.86% in 2040.
Book-running senior manager Wells Fargo led the negotiated sale, with Barclays Capital, Bank of America Merrill Lynch, Goldman Sachs & Co., JPMorgan, Loop Capital Markets LLC and Morgan Stanley were co-senior managers.
The TFA received 10 bids on the taxable QSCBs, offered through competitive sale. Citi made the winning bid with a true interest cost of 3.99% for the single 2038 maturity. The federal government will subsidize the interest on these bonds.
On April 9, the TFA will sell a $230 million conversion of tax-exempt variable rate demand bonds through competitive bid, bringing the total sale to $1.23 billion.
Standard & Poor’s and Fitch Ratings rate the TFA subordinate lien bonds AAA, while Moody’s Investors Service assigns Aa1 ratings.