NYC Bonds

The City of New York (“the City”) announced the successful sale of approximately $1.05 billion of General Obligation Bonds, comprised of $805 million of tax-exempt fixed rate bonds ($650 million new money and $155 million converted bonds) and $200 million of taxable fixed rate bonds.

During the retail order period for the tax-exempt bonds, the City received $470 million of retail orders – the most received since 2009 – of which $378 million was usable, representing approximately 47% of total tax-exempt bonds offered for sale.

During the institutional order period, the City received $3.5 billion of priority orders, representing over 8x the bonds offered for sale to institutional investors. Given the strong demand, the City reduced yields substantially during the institutional period. Stated yields were reduced by 4-9 basis points in the 2020-2028 maturities and 8-12 basis points in the 2029-2041 maturities. Final stated yields on the tax-exempt bonds varied by coupon and maturity, ranging from 1.33% in 2018 to 4.06% in 2043 for a 4% coupon bond.

The tax-exempt fixed rate bonds were sold via negotiated sale by the City’s underwriting syndicate led by book-running senior manager Jefferies, with BofA Merrill Lynch, Citigroup, Goldman, Sachs & Co., J.P. Morgan, Loop Capital Markets, Ramirez & Co., Inc., RBC Capital Markets, Siebert Cisneros Shank & Co., L.L.C. and Wells Fargo Securities serving as co-senior managers.

The City also sold $200 million of taxable fixed rate bonds, consisting of two subseries, via competitive bid. The first subseries of approximately $150 million of bonds maturing in 2019 through 2026 attracted nine bidders, with J.P. Morgan winning at a true interest cost of 2.915%. The second subseries of approximately $50 million of bonds maturing in 2027 through 2028 attracted 10 bidders, with J.P. Morgan winning at a true interest cost of 3.531%.