The New York City Transitional Finance Authority sold $946 million of future tax secured fixed-rate subordinate bonds on Jan. 16.
Of the $946 million, $505 million were tax-exempt new money bonds, $350 million were tax-exempt refunding bonds, and about $41 million were tax-exempt bonds that will be converted from variable-rate demand bonds to fixed-rate bonds.
Additionally, the TFA sold $50 million of taxable new money bonds through competitive sale.
The TFA received roughly $238 million of retail orders for the tax-exempt bonds during the two-day retail order period, according to a statement from the office of City Comptroller Scott Stringer. At the institutional pricing, the TFA received more than $2.2 billion in priority orders. Strong investor demand made it possible to reduce yields in most maturities by one to seven basis points.
"This week's TFA bond sale saw tight spreads and terrific demand by both individual and institutional investors resulting in about $22.7 million in budget savings for our taxpayers as well as capital plan funding," Stringer said in a statement. "I'm excited to start the new year with such a strong performance, which demonstrates great investor confidence in NYC credits. I look forward to building on this success in years to come."
Final stated yields on the tax-exempt fixed-rate bonds varied by coupon and maturity, ranging from 0.13% in 2014 to 4.40% in 2040.
The TFA's financing syndicate, led by book-running senior manager JPMorgan, sold the tax-exempt bonds with Barclays Capital, Bank of America Merrill Lynch, Goldman, Sachs & Co., Loop Capital Markets LLC, Morgan Stanley, and Wells Fargo serving as co-senior managers.
The TFA received 13 bids for the $50 million of taxable new money bonds offered. US Bancorp submitted the winning bid with a true interest cost of about 2.53%.
The TFA also intends to price $75 million of tax-exempt new money VRDBs on Feb. 3, bringing the total sale to about $1.021 billion.
Standard & Poor's and Fitch Ratings rate the subordinate lien bonds at AAA, while Moody's Investors Service rates them Aa1.
