On July 23, 2024, Siebert Williams Shank & Co., LLC (“SWS”) served as bookrunning senior manager for the City’s $85,290,000 Series 2024B Bonds.

This transaction was completed alongside the competitive sale of the City’s General Improvement Bonds, Series 2024A (the “Series 2024A Bonds”), for which SWS collaborated with the City’s financing team to assist with POS disclosure; SWS also participated as a member of a bidding syndicate for the competitive sale.

Proceeds of the Series 2024B Bonds will be used to redeem certain maturities or portions of certain maturities of the City’s General Improvement and Refunding Bonds, Series 2012A; General Improvement Refunding Bonds, Series 2014A; General Improvement Refunding Bonds, Series 2014B; General Improvement Bonds, Series 2015C; and General Improvement Bonds, Series 2016 (collectively, the “Refunded Bonds”).

The Series 2024B Bonds are direct obligations of the City and the City has pledged its full faith and credit and unlimited taxing power as to all taxable property in the City to the punctual payment of the principal of and interest on the Series 2024B Bonds.

The week prior to pricing, the market continued its positive tone with low digit bumps across the curve despite stronger than expected economic data. Going into pricing, the market was quiet and MMD was unchanged from the previous day.

To maintain compliance with both the State of Tennessee’s and the City’s debt policy requirements, SWS worked closely with the City and its co-financial advisors to determine the appropriate savings structure while maximizing NPV savings. SWS worked with the City’s financing team to evaluate several scenarios, including coupon structures, refunding candidates and call features. The Series 2024B Bonds were ultimately structured with uniform savings.

SWS also prepared sensitivity analysis related to the refunding candidates to ascertain how potential market movements might impact the financing.

Given the smaller size of select maturities, a sizeable new issue calendar, and dynamics related to the recently priced Series 2024A Bonds, SWS recommended entering the order period holding the pre-marketing levels. The transaction received strong interest in several parts of the curve, with oversubscription levels up to 4.4x; however, small unsold balances remained in maturities 2025, 2032-2036, 2038, and 2040 at the end of the order period.

At repricing, spreads were tightened by 4 basis points in 2026, 1 basis point in 2027-2028, 2 basis points in 2029, and 1 basis point in 2041-2044, while the 2025 maturities were widened by 2 and 1 basis point, respectively; SWS agreed to leave maturities with balances in the middle of the curve unchanged.

SWS underwrote the remaining $5.4 million in unsold balances. The City achieved 7.32% savings as a percentage of the Refunded Bonds in aggregate.