Refunding will generate more than $1.375 million annually in savings.
Philadelphia, January 31, 2014 – Philadelphia’s Office of the City Treasurer led the sale of $154.275 million on general obligation refunding bonds. The refunding refinanced higher cost bonds issued in 2008, saving more than $1.375 million annually for the next 24 years.
The refunding was made possible by the City’s recent bond rating agency upgrades, including a two-notch rating upgrade by Standard & Poor’s Rating Services to A+ with a stable outlook in December 2013. For the first time since the 1970s, the City’s bond rating is in the A category by all of the major rating agencies.
“The success of this bond refunding is further proof that the City of Philadelphia is on the right track. We are focused on ensuring the current and future financial stability of the City,” said Mayor Nutter. “While our improved rating and the interest in our bonds clearly indicate the progress we have made, there is still more work to do. I want to thank City Treasurer Nancy Winkler and her team for their efforts.”
The City sought to refinance the bonds during the summer of 2013 when it was selling bonds for the capital program but chose to delay the refinancing due to insufficient savings.
“We know that January is often a very good time to sell municipal bonds. So, we decided to prepare in December and early January and to be ready to sell if the savings were substantial,” said Nancy Winkler. “The bond upgrades were important for the refinancing because we were able to increase investor participation. Taxpayers benefit when there is more demand for the City’s bonds.”