Investors quickly gobbled up another $550 million in Connecticut debt despite a less than stellar credit rating.
State Treasurer Denise L. Nappier announced Tuesday that last week’s sale of general obligation (GO) bonds drew individual and institutional investors with its overall interest rate of 3.07 percent — the lowest cost of funds on any comparable state general obligation bond issue in the last 15 months — despite negative outlooks from three out of four credit rating agencies.
“Every dollar that we save today matters as the state looks to trim its budget during these challenging economic times,” Nappier said in a statement.
Ahead of last Wednesday’s bond sale, two credit-rating agencies — Moody’s Investors Service and Kroll Bond Ratings — placed the state’s GO bonds on negative outlook. Fitch Investors Service affirmed its stable outlook, while Standard & Poor’s Corp. continued its negative outlook.
Nappier said proceeds from the sale will be used to fund $335.7 million of state building projects and other purposes; $93.6 million in various grant programs; $75.7 million in improvements to Connecticut colleges and universities, $30 million in Town Road Aid, and $15 million for the Local Capital Improvement Program.
The bonds were offered through an underwriting syndicate led by Ramirez & Co. Inc.
The closing date for the bonds is scheduled for March 30.
Disclosure counsel are Day Pitney LLP and Finn Dixon & Herling LLP. Tax counsel are Robinson & Cole LLP and Soeder & Associates, LLC. Financial advisors are Acacia Financial Group, Inc. and A.C. Advisory.
