Close Menu
Fund Focus News
    Facebook X (Twitter) Instagram
    Trending
    • Mutual funds trim small-cap bets as institutional flows chase large caps – Jefferies explains what’s driving the trend – Money News
    • Debt MFs see outflow of ₹1 lakh cr in Sep on withdrawals from liquid, money market funds
    • Mutual Funds KYC: How To Check And Update Your Status, Here’s A Step-by-Step Guide | Savings and Investments News
    • ETFs vs Individual Stocks: What Should You Buy?
    • What the changing dynamics of inflation could mean for UK bond markets
    • Debt MFs witness ₹1 lakh cr outflow in September on withdrawals from liquid, money market funds
    • SBI Mutual Fund’s top 5 SIP plans – up to 20% CAGR in 10 years; Rs 10K investment turns into Rs 35 lakh – Money News
    • BOV announces issue of up to €325 million unsecured euro medium term bonds
    Facebook X (Twitter) Instagram
    Fund Focus News
    • Home
    • Bonds
    • ETFs
    • Funds
    • Investments
    • Mutual Funds
    • Property Investments
    • SIP
    Fund Focus News
    Home»Bonds»Cash-Flush Florida Tries to Buy Back Its Bonds for First Time
    Bonds

    Cash-Flush Florida Tries to Buy Back Its Bonds for First Time

    October 15, 2024


    (Bloomberg) — Florida bond investors are about to have an unusual decision to make — whether to sell their debt back to the state that issued the securities in the first place.

    Most Read from Bloomberg

    The state is offering its first ever buyback, or what’s known as a tender, to current holders. Essentially, state officials want to reduce their debt load, so they are offering to purchase the bonds at a premium. Usually this type of transaction is funded through a new bond sale as a refinancing tactic. But Florida is just offering cash after lawmakers set aside $500 million to pay down debt in the 2024 legislative session.

    “Very seldom do issuers have excess cash available,” said Ben Watkins, the state’s director of bond finance, in an interview. The premium is not public, but it is “very generous.”

    Florida has been actively reducing the amount of outstanding obligations after Governor Ron DeSantis took office in 2019. The governor touted that he’s paid down more than one-third of the state’s entire tax-supported debt over his term in a June budget release.

    “The state maintains a AAA credit rating, one of the lowest tax burdens in America, and more than $17 billion in reserve,” DeSantis said at the time.

    The tender comes as Florida assesses the damages from back-to-back hurricanes. It’s possible there may be a need for more borrowing, but that’s not imminent as it takes time to model losses and insurance claims are paid out over a five-year period, according to Watkins. “We are well positioned to deal with it,” he said.

    This year, Florida’s revenue collections are running roughly $1.1 billion above expectations, according to the state’s August revenue estimating conference. That’s primarily driven by levies on corporate income and investment earnings. The state is expecting to buy back about $500 million of its $15.3 billion of outstanding debt, Watkins said.

    A traditional bond tender is essentially a refinancing, allowing a municipality to swap out expensive debt for new bonds with a lower interest rate. Issuers offer to purchase bonds at a specific price on a certain date, usually above the current market value but still low enough that the government can realize savings.

    It’s been a popular tactic in recent years after federal tax-law changes eliminated a common type of refunding.

    The offerings are “much more accepted” among new borrowings these days, said Jeff Scruggs, head of the public sector and infrastructure group at Goldman Sachs Group Inc. “The effort is on the sales and trading side trying to get investors to tender their bonds.”

    States, cities and other issuers offered to repurchase about $30 billion in muni bonds last year, and are on track for a similar amount in 2024, according to an assessment from Barclays Plc. The bank estimated less than half that sum was successfully tendered.

    For the Florida transaction, investors have until Oct. 23 to decide whether to sell back their bonds. The state is offering to tender about $165 million of turnpike enterprise debt, $90 million of so-called right of way bonds for a state transportation program, and $245 million of public education bonds.

    Most Read from Bloomberg Businessweek

    ©2024 Bloomberg L.P.



    Source link

    Share. Facebook Twitter Pinterest LinkedIn Tumblr Telegram Email

    Related Posts

    What the changing dynamics of inflation could mean for UK bond markets

    October 22, 2025

    BOV announces issue of up to €325 million unsecured euro medium term bonds

    October 22, 2025

    Oman launches $207.9mln development bonds issue

    October 21, 2025
    Leave A Reply Cancel Reply

    Top Posts

    The Shifting Landscape of Art Investment and the Rise of Accessibility: The London Art Exchange

    September 11, 2023

    Charlie Cobham: The Art Broker Extraordinaire Maximizing Returns for High Net Worth Clients

    February 12, 2024

    ETFs vs Individual Stocks: What Should You Buy?

    October 22, 2025

    The Unyielding Resilience of the Art Market: A Historical and Contemporary Perspective

    November 19, 2023
    Don't Miss
    Mutual Funds

    Mutual funds trim small-cap bets as institutional flows chase large caps – Jefferies explains what’s driving the trend – Money News

    October 22, 2025

    The Nifty 50 reached an intraday high of 25,932 on October 21, 2025, also a…

    Debt MFs see outflow of ₹1 lakh cr in Sep on withdrawals from liquid, money market funds

    October 22, 2025

    Mutual Funds KYC: How To Check And Update Your Status, Here’s A Step-by-Step Guide | Savings and Investments News

    October 22, 2025

    ETFs vs Individual Stocks: What Should You Buy?

    October 22, 2025
    Stay In Touch
    • Facebook
    • Twitter
    • Pinterest
    • Instagram
    • YouTube
    • Vimeo
    EDITOR'S PICK

    Lina Hidalgo voices last-minute support for $4.4 billion Houston ISD bond – Houston Public Media

    October 25, 2024

    Why Meta Stock’s Mega AI Investments Are Likely to Pay Off Eventually

    August 9, 2024

    Now, you can transfer mutual fund units held outside demat to others. Here’s how

    June 17, 2025
    Our Picks

    Mutual funds trim small-cap bets as institutional flows chase large caps – Jefferies explains what’s driving the trend – Money News

    October 22, 2025

    Debt MFs see outflow of ₹1 lakh cr in Sep on withdrawals from liquid, money market funds

    October 22, 2025

    Mutual Funds KYC: How To Check And Update Your Status, Here’s A Step-by-Step Guide | Savings and Investments News

    October 22, 2025
    Most Popular

    🔥Juve target Chukwuemeka, Inter raise funds, Elmas bid in play 🤑

    August 20, 2025

    💵 Libra responds after Flamengo takes legal action and ‘freezes’ funds

    September 26, 2025

    ₹10,000 monthly SIP in this mutual fund has grown to ₹1.52 crore in 22 years

    September 17, 2025
    © 2025 Fund Focus News
    • Get In Touch
    • Privacy Policy
    • Terms and Conditions

    Type above and press Enter to search. Press Esc to cancel.