The Series 2025 Bonds were issued for the purpose of financing. NYWorks Transportation, SUNY Educational Facilities, SUNY Hospitals and SUNY Community Colleges, including (i) financing, refinancing or reimbursing all or a portion of the costs of certain programs and projects within the State, (ii) refunding certain State-supported debt previously issued by DASNY, and (iii) paying certain costs relating to the issuance of the Series 2025 Bonds.

The week of pricing had $10 billion of new issue supply slated to price, with $8.5 billion of that amount within 10 years. Leading up to pricing, 10-year ratios had widened out 9 basis points and 30-year ratios had widened 12.5 basis points. On the afternoon of Tuesday, September 2nd, DASNY held a Market. Update and Price Views Call, in which the syndicate conveyed a cautiously optimistic market tone that would be dependent on treasury market conditions, especially at the 10-year spot. Furthermore, based on the levels seen in secondary market trades that took place throughout the day, expectations for a 3 to 4 basis point cut across the MMD curve developed; however, MMD only adjusted with a 1 basis point cut across the curve.

On the morning of Wednesday, September 3rd, treasuries started the day a bit weaker, but had a more positive tone by the 10am Retail Order Period Call, following the release of the Jobs report figure. The rally in treasuries set a positive backdrop to enter the Retail Order Period, and the underwriters, DASNY, and its FAs were all comfortable beginning the ROP at spreads ranging from 15 to 40 basis points relative to interpolated MMD.

After running the Retail Order Period from 10:50am to 4pm, the transaction successfully garnered the desired traction with $1.1 billion in total orders, of which over $900 million was usable. Individual retail accounted for $98 million, NY retail accounted for 70% and national retail 30%. The “belly” had significant orders by the conclusion of the ROP, leaving a significant amount of the remainder in the long end of the curve where ratio driven buyers would be most supportive. DASNY also included a 50% hold back on oversubscribed maturities to incentivize institutional participation despite high retail demand during the retail order period.

DASNY, its MA, and the underwriter’s strategy of going into the Retail Order Period at more conservative levels to prevent chasing proved prudent, especially as the treasury market continued to rally significantly and Final MMD bumped 2 basis points from 2033 on out.

Another sizeable live transaction pricing concurrently with DASNY ended up accelerating, leaving DASNY as essentially the sole name of significance coming to market the following day.

Treasuries continued to cooperate on the morning of Institutional Pricing, down 4 basis points from the previous day which established a positive backdrop for the transaction. After the conclusion of the previous day’s Retail Order Period, the remaining balance to get done during the Institutional Order Period sat at approximately $1.1 billion. By the end of Preliminary Pricing, an overall strong result had been achieved for DASNY, with over $10 billion in orders generated from 138 different investors.

For the Verbal Award, the underwriters had generated enough institutional demand to be able to lower spreads for all maturities ranging from 2 to 8 basis points at Repricing. Final pricing spreads for all maturities were lower than the original Retail Order Period levels by 2 to 10 basis points across the curve.