Municipal bonds were stronger at midday according to traders, as yields were as lower by as much as two basis points.
Primary Market
Morgan Stanley priced the Kansas Department of Transportation's $400 million of Series 2015B highway revenue bonds. The bonds were priced to yield from 2.02% with a 5% coupon in 2025 to 2.75% with a 5% coupon in 2035. The deal is rated Aa2 by Moody's Investors Service, triple-A by Standard & Poor's and AA-plus by Fitch Ratings.
Since 2007, the Kansas DOT has issued about $2.2 billion of debt. The largest issuance took place in 2012 and 2014 when the department sold $496 million and $463 million, respectively. The DOT did not come to market in 2011 or 2013.
Bank of America Merrill Lynch won the bidding war for the Maryland Department of Transportation competitive sale of $300 million of Series 2015, Third Issue, consolidated transportation bonds, with a true interest cost of 2.46%. The bonds were priced to yield from 0.92% with a 5% coupon in 2018 to 3.00% with a 3% coupon in 2030.The issue is rated Aa1 by Moody's, triple-A by S&P and AA-plus by Fitch.
RBC Capital Markets priced the Ohio Water Development Authority's $210 million of water pollution control loan fund revenue bonds, series 2015A. The bonds were priced to yield from 1.21% and 1.29% with 5% coupons in a split 2020 maturity to 2.21% with a 5% coupon in 2026.
The District of Columbia sold $250 million of fiscal year 2016 GO tax revenue anticipation notes on Wednesday. PNC Capital Markets, BAML, RBC and Citi have won portions but details were not immediately available. The TRANs are rated MIG-1 by Moody's, SP-1-plus by S&P and F-1-plus by Fitch.
Since 2005, the District of Columbia has issued about $5.19 billion of note debt. The most issuance took place in 2010 and 2011 when D.C. sold $700 million and $820 million of notes, respectively. The nation's capital saw low years in 2005 when it issued $250 million and in 2006 and 2007 when it issued $300 million. During the past 10 years, it has come to market with notes an average of 1.5 times per year.
Bank of America Merrill Lynch priced the Delaware Transportation Authority's $213.140 million of U.S. 301 project revenue bonds, series 2015. The bonds were priced to yield from 1.63% with a 5% coupon in 2021 to 2.00% with a 5% coupon in 2023. The bonds were also priced to yield from 3.41% with a 3.25% coupon in 2032 to 3.79% and 3.30% with a 3.75% and 5% coupon in a split 2040 maturity. A split 2045 maturity was priced to yield 3.76% and 3.37% with a 4% coupon and 5% coupon. A 2055 term bond was priced to yield 3.67% with a 5% coupon. The deal is rated A1 by Moody's and AA-minus by S&P.
Citi priced the Michigan Finance Authority Local Government Loan Program's $201.150 million of department sewage disposal system revenue refunding second lien local project bonds, series 2015C for the Detroit Water and Sewerage Department.
The bonds were priced to yield 1.17% with a 3% coupon in 2017. The bonds were also priced to yield from 2.99% with a 5% coupon in 2025 to 3.39% with a 5% coupon in 2028 and yield from 3.68% with a 5% coupon in 2032 to 3.63% and 3.83% with 5% coupons in a split 2035 maturity.
The state of Texas sold $150 million of college student loan bonds, series 2015 GO AMT bonds, Wells Fargo Securities won with a TIC of 3.05%. No other pricing information was immediately available.
JP Morgan won Louisville/Jefferson Co. Metro Government's $127.715 million of water company system revenue bonds with a TIC of 2.74%. The bonds were priced to yield from 0.40% with a 2% coupon in 2016 to 3.262% with a 3.125% coupon in 2035. The deal is rated triple-A by both Moody's and S&P.
Secondary Market
Top-rated municipal bond prices were higher around lunch time on Wednesday. The yield on the 10-year benchmark muni general obligation was as much as one basis point lower from 1.98% on Tuesday, while the 30-year yield was as much as two basis points lower from 2.92%, according to a read of Municipal Market Data's triple-A scale.
Treasury prices were lower on Wednesday around midday. The two-year Treasury yield rose to 0.95% from 0.90% on Tuesday while the 10-year Treasury yield was higher at 2.20% from 2.15% and the 30-year was slightly up to 2.93% from 2.92%.
The 10-year muni to Treasury ratio was calculated on Tuesday at 91.9% from 91.1% on Monday, while the 30-year muni to Treasury ratio stood at 100.1% compared to 99.0%, according to MMD.
Bond Buyer Visible Supply
The Bond Buyer's 30-day visible supply calendar fell $1.90 billion to $9.54 billion on Wednesday. The total is comprised of $3.70 billion competitive sales and $5.84 billion of negotiated deals.
MSRB Previous Session's Activity
The Municipal Securities Rulemaking Board reported 41,020 trades on Tuesday on volume of $9.845 million.
