Chicago is jumping into the market Thursday with a scaled-down version of sales tax securitization bonds, which will refund outstanding general obligation bonds.
“The Sales Tax Securitization Corp. will sell approximately $624.6 million of tax-exempt bonds tomorrow, Nov. 15,” finance department spokeswoman Kristen Cabanban confirmed in a statement late Wednesday.
The revised deal drops the 2053 maturity that had raised concerns among some city Aldermen and market participants over the more than decade extension of maturities beyond the bonds being refunded.
While the deal is trimmed down from the $1.3 billion slated for late last month, it’s close to the $665 million that Chicago initially intended to sell. The city raised the size late last month after investors showed strong interest.
Chicago finance chief Carole Brown said demand offered the city a chance to get the full $3 billion borrowing program done before Mayor Rahm Emanuel leaves office in May as he is not seeking a third term.
The deal was set to price on Halloween, but bookrunner Loop Capital Markets moved the deal to the day-to-day calendar citing market conditions. The city faced rocky market conditions, rising rates, and heavier demand that week for short-term paper.
Bond Buyer 30-day visible supply at $5.83B
The Bond Buyer's 30-day visible supply calendar decreased $3.01 billion to $5.83 billion for Thursday. The total is comprised of $1.71 billion of competitive sales and $4.11 billion of negotiated deals.
ICI: Long-term muni funds saw $909M outflow
Long-term tax-exempt municipal bond funds saw an outflow of $909 million in the week ended Nov. 7, the Investment Company Institute reported Wednesday.
This followed an outflow of $1.196 billion in the week ended Oct. 31 and outflows of $179 million, $1.310 billion, $1.653 billion, $3 million and $374 million in the previous five weeks.
Taxable bond funds saw an estimated inflow of $1.686 billion in the latest reporting week, after seeing an outflow of $17.404 billion in the previous week.
ICI said the total estimated outflows to long-term mutual funds and exchange-traded funds were $2.436 billion after outflows of $16.353 billion in the prior week.
Previous session's activity
The Municipal Securities Rulemaking Board reported 46,601 trades on Wednesday on volume of $12.58 billion.
New York, California and Texas were the municipalities with the most trades, with the Empire State taking 15.941% of the market, the Golden State taking 15.911% and the Lone Star State taking 9.914%.
Muni money market funds see inflows
Tax-free municipal money market fund assets increased $138.5 million, raising their total net assets to $135.41 billion in the week ended Nov. 12, according to the Money Fund Report, a service of iMoneyNet.com.
The average seven-day simple yield for the 196 tax-free and municipal money-market funds inched up to 1.18% from 1.17% last week.
Taxable money-fund assets decreased $2.56 billion in the week ended Nov. 13, lowering total net assets to $2.736 trillion.
The average, seven-day simple yield for the 826 taxable reporting funds nudged up to 1.83% from 1.82% last week.
Overall, the combined total net assets of the 1,022 reporting money funds fell $2.42 billion to $2.872 trillion in the week ended Nov. 13.
Data appearing in this article from Municipal Bond Information Services, including the MBIS municipal bond index, is available on The Bond Buyer Data Workstation.
