Press Release: 03/22/04 3:00 PM Eastern
MunicipalBonds.com
North Carolina Municipal Bond Deal Unfair to Investors
A few weeks ago, North Carolina issued and began selling a new Municipal
Bond. The trading patterns of this new North Carolina issue show that North
Carolina Municipal Bonds can be and are unfair to investors.
The issue is described as North Carolina State Public Improvement: the
maturity we have tracked is the 4.25% maturing 3/1/25.
On its first day, Wednesday 3/10/04, one investor paid 98.362 for their
bonds, while another had to pay 100.9. This offer-side spread of 2.538 full
points is unfair. (See table below.) Things got worse four days later when
the offer-side spread widened to 2.583 full points. What this means in
yield terms is that one investor purchased this North Carolina Municipal
Bond for a yield of 4.32%, while another only received 4.05%. This yield
spread of .27% is clearly unfair and unreasonable.
The only good news for North Carolina investors is that it could be
worse...California's latest General Obligation shows four point offer-side
spreads. But this is not good company to be in.
To North Carolina Treasurer Richard Moore --
You have promoted yourself as an investor advocate. You preach to mutual
funds, the New York Stock Exchange and talk about corporate governance. But
what of your own securities market? what about the Municipal Bonds you
issue! The MSRB has escalated its warnings on fair pricing; the SEC just
released a study admitting the Muni Markets are at least five times worse.
We again ask you, Mr. Moore, to do something. Do you think the pricing of
this North Carolina Municipal Bond is fair and reasonable? This is your
market and your responsibility. It is time for State Treasurers to step up
and help Municipal Bond investors.
| Trade Date |
Municipal Bond Name / Description |
Coupon |
Maturity |
Bid Side
Customer Sold
to Dealer
(Lowest / Highest) |
 |
Offer Side
Customer Purchase
from Dealer
(Lowest / Highest) |
Yield*
Offer Side
(Lo Px / Hi Px) |
# of
Trades |
Volume
(000) |
| 03/10/2004 | NORTH CAROLINA ST PUB IMPT | 4.250% | 03/01/2025 | | | 98.362 / 100.900 | 4.37% / 4.25% | 46 | 7095+9 |
| 03/11/2004 | NORTH CAROLINA ST PUB IMPT-SER A | 4.250% | 03/01/2025 | | | 99.000 / 101.000 | 4.30% / 4.19% | 42 | 3120 |
| 03/12/2004 | NORTH CAROLINA ST PUB IMPT-SER A | 4.250% | 03/01/2025 | | | 99.250 / 101.000 | 4.30% / 4.13% | 43 | 2785 |
| 03/15/2004 | NORTH CAROLINA ST PUB IMPT-SER A | 4.250% | 03/01/2025 | | | 99.000 / 101.000 | 4.32% / 4.13% | 40 | 1145 |
| 03/16/2004 | NORTH CAROLINA ST PUB IMPT-SER A | 4.250% | 03/01/2025 | | | 99.000 / 101.583 | 4.32% / 4.05% | 55 | 3940 |
| 03/17/2004 | NORTH CAROLINA ST PUB IMPT-SER A | 4.250% | 03/01/2025 | | | 98.632 / 100.750 | 4.35% / 4.16% | 63 | 4775+2 |
| 03/18/2004 | NORTH CAROLINA ST PUB IMPT-SER A | 4.250% | 03/01/2025 | | | 98.636 / 101.000 | 4.35% / 4.13% | 29 | 2560+1 |
| 03/19/2004 | NORTH CAROLINA ST PUB IMPT-SER A | 4.250% | 03/01/2025 | | | 98.500 / 100.450 | 4.36% / 4.20% | 21 | 2150 |
Contact: Kevin Olson
Organization: MunicipalBonds.com
Phone: 415-922-7870
Email: Kevin@MunicipalBonds.com
URL: http://www.MunicipalBonds.com
 
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