Transaction Details

Sandwich Community Unit School District No. 430

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Following a competitive RFP process, Baird was selected to be the sole underwriter for the District’s $5,000,000 General Obligation Limited School Bonds, Series 2023 which carried an “A-” underlying S&P rating and qualified for “AA” rated bond insurance through Assured Guaranty.

The day before pricing, strong CPI data led to MMD decreases of 10 to 12 basis points (0.10%-0.12%) across the curve, and Baird lowered spreads by 5 basis points from its pre-marketing scale. The day of pricing, there was mixed data released with lower than expected PPI and stronger than expected retail sales, which resulted in the prior day’s decrease in rates getting peeled back by 9-10 basis points in the treasury market.

In spite of this market movement, Baird received $28.8 million in orders (5.7x total par) with oversubscriptions in all 11 maturities by as much as 10.5x. Because of these oversubscriptions, we were able to lower yields by 2 to 8 basis points (0.02%-0.08%) in 10 of 11 maturities, which increased the deposit to the project fund by approximately $15,300 and lowered the true interest cost by 4 basis points (0.04%).

Overall, we received orders from 12 unique investors, structured the Bonds with 5.50% coupons in the earlier maturities to help target a desired project fund for the District, and generated $4.8 million for the District’s working cash fund.