Recent Debt Summary & Related Issues

Transcription

1 Recent Debt Summary & Related Issues Recent Financings $268,545,000 Series 2007A COPs $119,400,000 Series 2007B COPs $192,310,000 Series 2007C COPs $30,485,000 Series 2007D COPs May 18, 2007 presented by Public Financial Management 300 S. Orange Avenue, Suite 1170 Orlando. FL (407) (407) fax

2 Recent Activity and Series 2007A and Series 2007B Certificates Recent Activity Extended liquidity facilities for Series 2002B and Series 2003B COPs (Dexia) at significantly reduced rates and longer terms Bond insurance quote for Series A COPs was a record low at the time of 15.8 bps Evaluated performance of variable rate pricings for prior financings Series 2007A and Series 2007B Series 2007A - On February 7, 2007 the District successfully sold $268,545,000 Certificates of Participation, Series 2007A. The 2007A Certificates were issued in fixed-rate mode and had an All-In True Interest Cost of 4.45%. Series 2007B - On March 20, 2007 the District set the initial rate for $119,400,000 Certificates of Participation, Series 2007B. The 2007B Certificates were issued in 7-day auction-rate mode and had an initial rate of 3.45%. In order to obtain the most cost effective structure, the 2007A Certificates have maturities from and , while the 2007B Certificates had maturities In aggregate the structure created level annual lease payments. Moody s, S&P and Fitch confirmed underlying ratings of A1, AA-, and A+, respectively, to the Series 2007A and 2007B Certificates. 2

3 Allocation of 2007A Certificates An aggressive retail marketing effort was implemented for the sale of the 2007A Certificates. Approximately $84 million of principal was placed through retail orders, or over 30% of the total par amount. Below is a breakdown of the underwriter allotments for the 2007A Certificates. Underwriting Retail Priority Member Total Participation Orders Allotments % Orders Allotments % Orders Allotments % Orders Allotments % UBS Securities LLC 35.00% 36,560 35, % 259,270 60, % 9,635 9, % 305, , % Bear, Stearns & Co., Inc % 2,325 2, % 23, % 25,000 27,325 25, % Citigroup 13.50% 16,625 16, % 23, % 16,625 40, % AG Edwards & Sons 9.50% 12,710 12, % 16, % 12,710 29, % Merrill Lynch & Co. 9.50% 12,040 12, % 16, % 40,000 52,040 28, % RBC Capital Markets 9.50% 14,725 4, % 16, % 9,500 24,225 21, % Siebert Brandford Shank 9.50% 16, % 31,500 31,500 16, % Jackson Securities LLC 0.00% % 2,000 2, % Loop Capital Markets 0.00% 1,000 1, % 1,000 1, % Total % 95,485 84, % 259, , % 118,635 10, % 473, , % Distribution Distribution of Takedown UBS Securities LLC 38.77% Bear, Stearns & Co., Inc % Citigroup 15.60% AG Edwards & Sons 9.58% Merrill Lynch & Co % RBC Capital Markets 8.03% Siebert Brandford Shank 6.86% Jackson Securities LLC 0.14% Loop Capital Markets 0.33% Total % 445, , , , , , , , , ,149,

4 Allocation of 2007B Certificates The District s 3 senior underwriting firms (Bear Stearns, Citigroup and UBS) placed the 2007B Certificates and will serve as broker dealers on an ongoing basis. The 2007B Certificates initially priced 15 bps below BMA during the initial order period, or 3.45%. The auctions are set up as a jump ball where all three firms compete for the total par amount at each auction. The allocation was originally 55%/23%/22%, respectively. Over time the allocation will change as demand increases and decreases from each firm. Competition at each auction results in the District getting the lowest rate regardless of the demand from a specific bank. Allocation of Series 2007B Auction Rate COPs 120% 100% Allocation 80% 60% 40% 20% UBS Citigroup Bear Stearns 0% Auction Period (7 days) 4

5 Combination of Series 2007C and Series 2007D Refunding COPs Series 2007C On February 27, 2007 the District successfully sold $192,310,000 Certificates of Participation, Series 2007C to advance refund certain 2001A and 2002C Certificates. The 2007C Certificates were issued in fixed-rate mode and had an All-In True Interest Cost of 4.41%. The District achieved present value debt service savings of $7,920,411, or 4.25% of the refunded par amount. Merrill Lynch served as senior manager on this transaction. Series 2007 D On April 10, 2007 the District successfully sold $30,485,000 Certificates of Participation, Series 2007D to current refund outstanding 1997A Certificates. The 2007D Certificates were issued in fixed-rate mode and had an All-In True Interest Cost of 4.07%. The District achieved present value debt service savings of $1,261,120, or 4.08% of the refunded par amount. Bear Stearns served as senior manager on this transaction. Series 2007C Series 2007D Total Series Refunded 2001A & 2002C 1997A Par Amount Refunded 186,400,000 30,940, ,340,000 Present Value Savings 7,920,411 1,261,120 9,181,531 Percent Savings 4.25% 4.08% 4.22% 5

6 Allocation of 2007C Certificates The original refunding concept proposed by Merrill Lynch included a par/discount coupon structure that would allow the District to maximize debt service savings. The structure was slightly modified due to market conditions at the time of sale and some premium bonds were incorporated into the structure. Below is a breakdown of the underwriter allotments for the 2007C Certificates. Underwriting Retail Priority Member Total Participation Orders Allotments % Orders Allotments % Orders Allotments % Orders Allotments % Merrill Lynch & Co 40.00% 51,020 4, % 197, , % 44,705 44, % 293, , % Bear Stearns 12.50% % 26,705 1, % 26,955 1, % Citigroup 12.50% 1,380 3, % 26,500 1, % 30,880 4, % UBS Securities 12.50% 4,805 2, % 36,500 1, % 41,305 4, % AG Edwards 7.50% 3, % 3, % RBC Capital Markets 7.50% ,250 12,670 Siebert Brandford Shank 7.50% % % 23,000 1, % 24,000 2, % Total % 58,125 11, % 198, , % 172,855 50, % 432, , % Distribution Distribution of Takedown 375, , , , , , , , Merrill Lynch & Co 40.00% Bear Stearns 12.50% Citigroup 12.50% UBS Securities 12.50% AG Edwards 7.50% RBC Capital Markets 7.50% Siebert Brandford Shank 7.50% Total % 6

7 Allocation of 2007D Certificates Due to tax law regulations, the 2007D Certificates that were issued to currently refund the 1997A Certificates could not be closed prior to July 3, 2007 (90 days prior to October 1, 2007 call date). The transaction was priced as soon as possible given this constraint in order to lock in the favorable market conditions. Below is a breakdown of the underwriter allotments for the 2007D Certificates. Retail Priority Member Total Underwriting Allots Post Participation Orders Allotments % Orders Allocation % Orders Allotments % Orders Allotments % Bear, Stearns & Co., Inc % 4,150 4, % 17,440 6, % 5,020 4, % 26,610 14, % Citigroup 15.00% % 2, % 600 2, % UBS Investment Bank 15.00% % 3,805 3, % 4,500 8,405 3, % A.G. Edwards 7.50% % 1, % 3,740 4,340 2, % RBC Capital Markets 7.50% % % 2,000 2, % Merrill Lynch & Co. 7.50% 2,105 1, % 1, % 3,805 5,910 3, % Siebert Brandford Shank 7.50% 2, % 4,000 1, % 4,000 3, % Total % 8,055 7, % 21,245 17, % 23,065 5, % 52,365 30, % Distribution Distribution of Takedown Bear, Stearns & Co., Inc % Citigroup 9.11% UBS Investment Bank 10.93% A.G. Edwards 7.50% RBC Capital Markets 2.05% Merrill Lynch & Co % Siebert Brandford Shank 10.25% Total % 54, , , , , , , ,

8 Investment of Proceeds Bids specifications for fully flexible repurchase agreements were sent to ten providers. Bids were accepted on April 27 th. For the 2007A issue, the amount of the investment was $268,462,728 4 firms submitted bids, 6 firms passed, 2 were selected. The winners were Depfa Bank with a rate of % and Morgan Stanley & Co with a rate of %. For the 2007B issue, the amount of the investment was $114,733,318 6 firms submitted bids, 4 firms passed, 1 was selected. The winner was RBC Capital Markets with a rate of %. 8