Buy side

2012 was a good year for municipal bond mutual funds, approaching the robust overall returns seen in 2011. Muni funds with long maturities that focused on high yield performed best.

The outlook for the water and sewer sector is mostly stable for this year, although utilities will face rate and drought pressures, said Standard & Poor's.

In his more than 25 years on the municipal bond desk at Merrill Lynch and BlackRock, Peter Hayes has had front-row seats to some of the biggest changes in asset management, and in particular, how they've affected the municipal bond industry. He brings those to bear in his analysis for 2013.

Kroll Bond Rating Agency may make little headway into breaking up the "big three," but it may trigger changes in operations by Moody's Investors Service, Standard & Poor's and Fitch Ratings, according to a municipal analyst.

The Bond Buyer weekly yield indexes were narrowly mixed the week ended Jan. 24.

Inflows to municipal bond mutual funds, while still robust, have fallen for a second straight week, to $871 million from funds that report their flows weekly.

After downgrading Assured Guaranty, Moody's Investors Service has taken action on the short-term and long-term ratings of 78 variable rate demand bonds.

Tax-exempt money market funds continued their downward as they reported $2.44 billion of outflows, for the second week in a row of net outflows.

The large scale changes sweeping the nonprofit health care sector, chief among them changes in payment methods, are driving the record-setting consolidation trend among hospitals, Fitch Ratings says.

Two hospitals in Chicago's western suburbs — Elmhurst Memorial Healthcare and Edward Hospital & Health Services — are the latest to merge, joining the two-year-old surge nationally of not-for-profit healthcare consolidation.

Moody's Investors Service placed tobacco settlement revenue bonds of issuers in 17 states and two territories under review with direction uncertain because of legal settlement announced in December. The action affects $20.5 billion of debt.

An estimated $9.19 billion is expected to be priced in the municipal primary market, compared with a revised $5.89 billion last week, as billion-dollar-plus deals from Ohio and New Jersey head the negotiated slate.

Illinois will take competitive bids on $500 million of GOs later this month in its first borrowing of the New Year and first test of market reaction to the General Assembly's failure to overhaul pensions.

Standard & Poor's revised its growth forecast for 2013 on state and local governments to be slightly higher and Fitch Ratings gave most sectors a stable outlook for the year.

Municipal bond mutual funds recorded a second consecutive week of strong flows, as funds that report their flows weekly saw $1.44 billion in inflows for the week of Jan. 16

Municipal bond mutual funds saw $43 billion in inflows in 2012, a huge increase over flow numbers from the previous two years.

Tax-exempt money market funds gave up two-thirds of the impressive gains they generated last week.

New York public health system Nassau Health Care Corp. captured an interest rate of 0.4% and saw broad investor interest Tuesday when it sold $40 million of insured revenue anticipation notes backed by future Medicaid payments.

The Austin City Council is expected to approve up to $150 million of taxable revenue bonds Thursday to build a new consolidated car rental facility and parking garage at Austin Bergstrom International Airport.

Bond insurer MBIA Inc. announced that the New York State Department of Financial Services denied a request by MBIA Insurance Corp. to make its interest payment scheduled for Tuesday.