In Case You Missed It: New Jersey Tops Savings Estimates in Debt-Service Restructuring

Dunstan McNichol
April 23, 2010, 5:42 PM EDT
New Jersey, the third-most indebted U.S. state, will save about $679 million in debt service through 2013 in a restructuring that exceeded state estimates, a spokesman for Treasurer Andrew Eristoff said.
The $703 million deal for the New Jersey Economic Development Authority, which sold to yield 3.52 percent, cuts New Jersey's debt payments by $68 million this year and $611 million over the next three years, according to an analysis by Bank of America Merrill Lynch, the manager of the sale. The savings had been projected at $60 million in the current year and $605 million over the following three.
Separately, the state sold $104 million in taxable Build America Bonds maturing from 2032 to 2035 to yield 6.425 percent, or 175 basis points over 30-year Treasuries, according to data compiled by Bloomberg. A basis point is 0.01 percentage point.
The bonds were the first sold since Governor Chris Christie took office Jan. 19. The state plans to offer $750 million of federally subsidized Build Americas the week of May 10, Pratt said today in an interview.
California and New York are the first- and second-most indebted U.S. states.
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