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H2C INDUSTRY INSIGHTS: CAPITAL MARKETS

Bond Issuance & Volume

Week of November 6, 2023

Primary Market Activity: Healthcare

Commentary – Monthly Deal Activity

  • There were 661 municipal bond issues in October for a total of $37.2 billion, a 29.3% increase year-over-year, and the second straight month of year-over-year supply growth. However, October’s $37.2 billion of issuance is still below the 10-year average of $43.8 billion for the month (1).

  • Not-for-profit hospital issuance was $1.3 billion in October, a 14% decrease compared to September and a 25% decrease year-over-year. Year-to-date, not-for-profit hospital issuance is down nearly 40% compared to the same time period in 2022.

  • Vandalia Health came to market with $407.7 million of tax-exempt, fixed rate bonds. Proceeds from the bonds will refund previous issuances and fund improvements at Vandalia hospitals throughout West Virginia. The bond structure includes 6% coupons on select term bonds maturing in 2048 and 2053. A portion of the bonds are insured by AGM.

Not-For-Profit Hospital Issuance • ($ in billions)

oct-hospital-table_edited.jpg
  1. Source: The Bond Buyer as of October 31, 2023.

  2. Bonds are insured by Assured Guaranty Municipal (AGM).

  3. Spreads as of the date of sale. Tax-exempt bonds are spread to the corresponding AAA MMD benchmark maturity published by TM3. Taxable bonds spread to 30-year UST unless otherwise stated.

Primary Market Activity: Higher Education

Commentary – Monthly Deal Activity

Higher Education Issuance • ($ in billions)

  • There were 661 municipal bond issues in October for a total of $37.2 billion, a 29.3% increase year-over-year, and the second straight month of year-over-year supply growth. However, October’s $37.2 billion of issuance is still below the 10-year average of $43.8 billion for the month (1).

  • Total higher education issuance was $656.8 million in October, a 50% decrease compared to September and a 27% decrease year-over-year. Year-to-date, higher education issuance is down 29% compared to the same time period in 2022.

  • Colorado State University came to market with $60.7 million (Series 2023A-1) of long-term, fixed rate bonds and $60.0 million (Series 2023A-2) of put bonds structured with a mandatory tender on March 1, 2032. Bond proceeds will be used to: (i) finance various campus improvements; (ii) fund capitalized interest and; (iii) pay costs of issuance. 

Source: Bloomberg LP

  1. Source: The Bond Buyer as of October 31, 2023.

  2. Bonds insured by BAM.

  3. Remarketing of Series Y Bonds (originally issued June 1, 2000).

  4. Put Bonds; priced to mandatory tender on March 1, 2032. 

  5. Spreads as of the date of sale. Tax-exempt bonds are spread to the corresponding AAA MMD benchmark maturity published by TM3. Taxable bonds are spread to the 30-year UST unless otherwise noted.

Key Rate Updates

Source: U.S. Department of the Treasury, Bond Buyer, Investment Company Institute, Bloomberg and Refinitiv/TM3. Data as of November 3, 2023.


The information presented herein was obtained from resources believed to be reliable and accurate, but H2C Securities Inc. does not guarantee the accuracy or completeness or assume a responsibility for any loss which may result from the action by any person upon such information. Such information is subject to change without notice and is not intended as a recommendation, offer, or solicitation with the respect to the purchase or sale of any security.

About H2C Securities Inc. ("H2C")

H2C is a strategic advisory and investment banking firm committed to providing superior advice to healthcare organizations, higher education institutions, and related companies throughout the United States. H2C’s professionals have a long track record of success in healthcare and higher education mergers and acquisitions, capital markets, and real estate transactions, acting as lead advisors on hundreds of transactions representing billions of dollars in value.

Securities and services offered through H2C Securities Inc., member FINRA/SIPC, a registered broker-dealer and an indirect subsidiary of Fifth Third Bank, National Association. All rights reserved. Securities and services offered through H2C Securities Inc.: Are Not FDIC Insured; Offer No Bank Guarantee; May Lose Value; Are Not Insured by any Federal Government Agency; Are Not a Deposit.

H2C Capital Markets Team

Richard Bayman

Managing Director 404.937.1340

rbayman@h2c.com

William B. Hanlon III

Managing Director

858.242.4801

bhanlon@h2c.com

Emily Abrantes

Managing Director

212.257.4500

eabrantes@h2c.com

Victoria Poindexter

Managing Director

312.508.4201

vpoindexter@h2c.com

Greg Zuber

Analyst

312.508.4202

gzuber@h2c.com

Anirudh Vemulapalli

Analyst

212.257.4534

avemulapalli@h2c.com

Shawn Sinel

Director

212.301.2700

ssinel@h2c.com

Catherine Gao

Vice President

212.257.4508

cgao@h2c.com

Luke Vaughn

Associate

312.508.4206

lvaughn@h2c.com

Calvin Zhu

Analyst

847.654.1508

czhu@h2c.com

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