Honolulu Star-Advertiser
Hawaii News
By Star-Advertiser Staff
August 13, 2020
The state said Wednesday it successfully sold $995 million of general obligation bonds and will use the proceeds to finance capital improvements such as the acquisition, construction, and improvement of various public buildings and facilities, elementary and secondary schools, community college and university facilities, public libraries, and parks, and other public purposes.
“This bond sale is a critical component of the state’s plan to stimulate the local economy by spending on capital projects that will keep many residents working while delivering needed improvements to our public facilities,” Gov. David Ige said in a statement.
The state said it sold the bonds to a broad range of domestic and international investors. Over 72 investors placed orders and the state received international interest from Europe and Asia. The state said its strong credit and long-term strength appealed to a large range of buyers. The $995 million of 2020 FZ Series GO bonds have maturities ranging from 2025 to 2040. The bonds were issued at a historically low “all-in true interest cost” of 1.90%.
Videoconferencing was used to engage Fitch, Moody’s, and Standard & Poor’s in the credit ratings process and the presentations were led by Ige. The ratings effort culminated with Fitch and Standard & Poor’s maintaining their ratings of AA+ with a negative outlook for the state’s general obligation bond debt. They cited the state’s increased reserves and control over a broad array of budget balancing options and the state’s strong financial position and management’s well- established, proactive budget monitoring practices, respectively. In assigning a revised rating of Aa2 with a stable outlook, Moody’s acknowledged the state’s strong financial governance practices and noted the impact of the coronavirus pandemic on the state and its tourism industry.
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