Pricing on Ohio’s
The price guidance for the Goldman Sachs, Citigroup and Credit Agricole –led Ohio deal shows the 1.6-year, A-1 notes talked at 20 basis points over the eurodollar synthetic forward curve (EDSF). The 5-year, A-2 paper is being talked between 43 to 45 basis points over interpolated swaps; and the 13.69 year, A-3 tranche is being talked between 70 to 73 basis points.
Fitch Ratings, Moody’s Investors Service and Standard & Poor’s have all assigned triple-A ratings to the bonds.
Current credit spreads for corporate and utility bond offerings - the best comparable to this bond – are historically narrow or "tight," according to Saber Partners, LLC a New York advisory firm that has participated in the structure, marketing and pricing of about $8 billion of similar offerings in 5 states.
According to a June 6, research Citigroup securitization research put fixed rate spreads for 2-year utility ABS at 15 basis points, five-year bonds at 30 basis points and 10-year bonds at 55 basis points.
In March 2012, American Electric Power's (AEP) Texas Central Co. (TCC) closed an $800 million securitization backed by customer charges to recover costs related to the deregulation of Texas' electric market. Its $310 million, approximately 10-year, triple-A tranche was priced at 70 basis points over swaps.