Baptist Health Care Corporation (Baa2/BBB+/BBB), Pensacola, Fla., is planning to price a total of $589.4 million in bonds consisting of $523.9 million in tax-exempt, fixed-rate bonds (Series 2020A) and $65.5 million in taxable, fixed-rate bonds (Series 2020B) to fund new money projects and refund prior obligations. (See Baptist Health POS.)
Johns Hopkins Health System (Aa2/AA-/AA-), Baltimore, Md., is planning to price a total of $318.9 million in taxable, fixed-rate bonds (Series 2016 and Series 2020) to refund prior obligations. (See Johns Hopkins Health System POS.)
Rex Healthcare (A2/AA-/NR), Raleigh, N.C., is planning to price a total of $200 million in tax-exempt, fixed-rate bonds (Series 2020A) to fund new money projects and refund prior obligations. (See Rex Healthcare POS.)
Recent Rating Actions
NYU Langone Hospitals (NY): Affirmed A3; Outlook stable
Parkview Medical Center (CO): Affirmed A3; Outlook stable
Johns Hopkins Health System (MD): Affirmed Aa2; Outlook stable
University Health (GA): Affirmed A1; Outlook stable
Baptist Health Care Corporation (FL): Downgraded to Baa2 from A3; Outlook stable
NYU Langone Hospitals (NY): Upgraded to A from A-; Outlook stable
North Mississippi Health Services (MS): Affirmed A+; Outlook stable
Cottage Health (CA): Upgraded to AA- from A+; Outlook stable
Baptist Health Care Corporation (FL): Assigned BBB+; Outlook stable
Johns Hopkins Health System (MD): Affirmed AA-; Outlook stable
Presbyterian Intercommunity Health (CA): Affirmed A; Outlook revised to “negative” from stable
Cottage Health (CA): Affirmed AA-; Outlook stable
Baptist Health Care Corporation (FL): Downgraded to BBB from A-; Outlook stable
H2C INSIGHTS as of Jan. 20, 2020
Rates and Economic News
From Jan. 10 to Jan. 17, 10-year and 30-year MMD rates decreased by 6 bps and 4 bps, while 10-year and 30-year Treasury rates both increased by 1 bp, respectively. For the seven-day period ending Jan. 15, municipal bond funds recorded $2.34 billion of net inflows, according to Lipper—the 54th straight week of inflows.
SIFMA decreased 14 bps to 0.80 percent, while tax-free municipal money-market fund assets decreased by $993 million to total net assets of $140.5 billion for the seven-day period ending Jan. 15.
On Jan. 15, the phase-one trade deal was officially signed between the United States and China. It aims to sharply increase sales of U.S. goods and services to China, help protect intellectual property, and further open Chinese markets to foreign firms. Economists predict that the new agreement should boost business investment and keep U.S. growth at a slow-but-steady pace in 2020.
On Jan. 17, the U.S. Treasury announced it will introduce a 20-year bond in the first half of the year. According to The Wall Street Journal, the Treasury expects strong demand for the 20-year bond based on solicited feedback from a broad set of market participants,. Analysts are predicting the new bonds will add to the popular trend of investors betting that long-term yields will rise faster than shorter-term yields in the upcoming months. Furthermore, short-term yields could remain low, as the Fed has signaled it won’t raise interest rates anytime soon, while improvements in U.S. economic data could put upward pressure on longer-term yields. The Treasury last sold 20-year bonds in March 1986.
On Jan. 14, Dartmouth-Hitchcock Health (NR/A/A), Hanover, N.H., priced a total of $125 million in tax-exempt, fixed-rate bonds (Series 2020A). The Series 2020A bonds are structured as a bullet maturing in 2059, with a 5 percent coupon priced at a YTC of 3 percent.
Hammond Hanlon Camp LLC (“H2C”) is an independent, healthcare-focused strategic advisory and investment banking firm with a particular emphasis on the not-for-profit sector. The firm’s principals have been lead advisors on hundreds of transactions in the healthcare industry representing billions of dollars in value, offering the experience and industry knowledge to achieve the most favorable results.
858 242 4810
CAPITAL MARKETS UPDATE
MMD YIELD CURVE • Current vs. 1 Year Ago
UST YIELD CURVE • Current vs. 1 Year Ago
INTEREST RATE SNAPSHOT
Source: Bond Buyer, Bloomberg and MMD – Thomson Reuters Municipal Market Data as of Jan. 17, 2020.
(1) Rates as of Jan. 15, 2020.
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