(Reuters) – Puerto Rico’s troubles continued to worsen on Monday after mutual funds holding about $1.7 billion in its debt sued the commonwealth while other investors sold the bonds on concerns the island’s finances could deteriorate further.
The flashpoint for the lawsuit brought by two large institutional holders is a law passed last week that allows Puerto Rico’s public corporations – primarily its troubled electric power authority known as PREPA – to restructure their debt. It sparked a sharp selloff in these agency bonds that extended on Monday.
WASHINGTON, June 24 (Reuters) – The Securities and Exchange
Commission is seeking an emergency restraining order to prevent
a Chicago suburb from selling bonds this month, alleging in
court documents filed on Tuesday that the city and its
comptroller misused bond proceeds and schemed to defraud
In a complaint filed against the town of Harvey, Illinois,
and the comptroller, Joseph Letke, in the U.S. District Court
for the Northern District of Illinois, the SEC also demanded a
jury trial – an unusual request in the SEC’s current crackdown
on the $3.7 trillion municipal bond market.
WASHINGTON (Reuters) – The top U.S. securities regulator on Friday set her sights on the less transparent multi-trillion dollar bond market, saying new reforms are needed to foster competition and reduce costs for investors.
“Trading in these massive fixed income markets…remains highly decentralized, occurring primarily through dealers where costs of intermediation are much more difficult to measure,” said Securities and Exchange Commission Chair Mary Jo White in prepared remarks at the Economic Club of New York.
WASHINGTON, June 13 (Reuters) – Despite the continued
fallout of the “Bridgegate” scandal, the Port Authority of New
York and New Jersey will sell $400 million bonds next week.
The Securities and Exchange Commission is conducting a
parallel investigation of the scandal to the New York County
District Attorney’s review, the authority disclosed in
preliminary documents for the sale released on Thursday.
WASHINGTON, June 5 (Reuters) – Households backed away from
U.S. municipal bonds at the fastest pace in more than a year in
the first quarter, shunning a big rally in the largely tax-free
asset and leaving them holding the smallest slice of the market
in at least a decade.
Long the biggest investing force in the market, households
cut their municipal bond holdings at a seasonally adjusted
annual rate of $110.9 billion in the first three months of the
year, according to Federal Reserve data released on Thursday.
That was the most aggressive pullback by households, essentially
individual investors, since the fourth quarter of 2012.
WASHINGTON, June 5 (Reuters) – Municipal and corporate bond
dealers would have to tell investors how much they charge to
cover their compensation under bipartisan legislation currently
in the U.S. Senate to end secret price markups.
The proposal, quietly introduced earlier this year by
Virginia Democratic Senator Mark Warner and Oklahoma Republican
Senator Tom Coburn, comes as momentum is growing among U.S.
securities regulators to bring more transparency to the combined
$13 trillion-plus municipal and corporate bond markets.
WASHINGTON (Reuters) – U.S. cities and states are leery of borrowing more money despite near-record low interest rates, forcing bond funds to scour for investments and boosting returns on existing debt.
The drought in issuance is also slowing city and state capital projects and threatens to disrupt the summer high season for bond buying.
WASHINGTON/CHICAGO (Reuters) – New Jersey, which revealed a massive budget shortfall this week, is far from alone in feeling the pinch of lower income tax revenues in the key month of April, a Reuters analysis shows.
Personal income tax collections plunged last month from a year earlier in 27 of 32 states for which Reuters was able to collect data. That’s most of the 43 states that levy income taxes, and drops were as high as 50 percent.
WASHINGTON (Reuters) – Washington, D.C. will have to find a new front in its battle for budget independence from the Congress after a district court judge on Monday decided the country’s capital city cannot by law decide how to spend its revenues.
As a native of Washington, District Judge Emmet Sullivan said he was “deeply moved” by the argument that “the people of the District are entitled to the right to spend their own, local funds.” But he added he was “powerless to provide a legal remedy and cannot implement budget autonomy for the District.”
WASHINGTON, May 16 (Reuters) – Refinancing will come roaring
back into the U.S. municipal market next week, when $5.7 billion
in total new issuance is expected.
Two-thirds of the $4.36 billion in negotiated sales are
refinancing deals. About a fifth of the $1.34 billion in
competitive sales will go toward refunding.