DiNapoli Announces Award of New York
Local Government Assistance Corporation Bonds
Series 2010B Tax-Exempt New York Local Government Assistance
Corporation Subordinate Lien Refunding Bonds: $206,020,000 Awarded
State Comptroller Thomas P. DiNapoli today announced the award, through a competitive sale, of $206,020,000 in New York Local Government Assistance Corporation (“LGAC”) Series 2010B Subordinate Lien Refunding Bonds to Citigroup Global Markets Inc. The true interest cost of the winning bid was 2.899643 percent.
Other bids were submitted by: Bank of America Merrill Lynch, Goldman, Sachs & Co., Wells Fargo Bank, National Association, J.P. Morgan Securities LLC, Barclays Capital, Inc., Morgan Stanley & Co Inc, and Jefferies & Company, Inc. at true interest costs of 2.909848 percent, 2.926918 percent, 2.969446 percent, 2.972876 percent, 3.006951 percent, 3.048737 percent and 3.088517 percent, respectively. All bids were received via IPREO’s BiDCOMP/PARITY competitive bidding system, BiDCOMP.
The net proceeds of the Series 2010B Subordinate Lien Refunding Bonds will be used to call and redeem $265,100,000 in previously issued senior lien variable-interest rate bonds. The bonds will mature on each April 1 beginning on April 1, 2012 and ending on April 1, 2023. The bonds are expected to be delivered on December 1, 2010.
Refunding the variable-rate bonds with fixed-rate bonds allows LGAC to take advantage of the low-interest rate environment and reduce its exposure to interest rate risk, liquidity renewal risk and support cost increases.
The 2010B Subordinate Lien Refunding Bonds will be general obligations of LGAC, payable from payments LGAC receives from the state. The state’s payments to the LGAC are derived from a portion of the revenues collected from certain sales and compensating use taxes imposed by the state on a statewide basis.
Under the Public Authorities Law, LGAC is required to enter into an agreement with the New York State Comptroller for the sale of all LGAC bonds and notes. Comptroller DiNapoli serves as LGAC’s “Exclusive Agent” for these sales.
Click for additional information about the New York Local Government Assistance Corporation.