For immediate release:  May 13, 2003
For more information:  Barton Potter (360) 902-9033

State earns savings from bond refinancing

OLYMPIA—A bond refunding (refinancing) sale today allowed the Office of the State Treasurer to save almost $6.9 million compared to the original cost of financing the bonds.

“Whenever we have a chance to save money for the state of Washington , we are more than happy to do a refunding like this,” State Treasurer Michael J. Murphy said.

The State Finance Committee this morning awarded a bid to US Bancorp Piper Jaffray for the sale of $79 million in refunding bonds.  The refinanced bonds were originally issued in August 1994.

Murphy said the downturn in the economy has not dampened the rating agencies’ confidence in state of Washington bonds.  Fitch Ratings, Moody’s Investors Service and Standard & Poor’s all recently affirmed the state’s credit rating.

“We got outstanding interest rates on these bonds, which just shows that Washington bonds are still highly regarded in the marketplace,” Murphy said.

Refunding for the bonds (various purpose general obligation refunding bonds, Series R-2003C) saves the state nearly $6.46 million in net present value, which equates to a savings of 8.39 percent of the refunding par value.

US Bancorp Piper Jaffray offered a true interest cost (TIC) bid of 2.8014070 percent.  Also bidding were Merrill Lynch & Co. (2.8151694% TIC), Banc of America Securities LLC (2.8256264%), J.P. Morgan Securities Inc. (2.8329104%), Goldman Sachs & Co. (2.8369772%), ABN AMRO Financial Services Inc. (2.8910728%) and Citigroup Global Markets Inc. (2.9067607%).

Treasurer Murphy is chairman of the State Finance Committee and serves on the committee along with Gov. Gary Locke and Lt. Gov. Brad Owen.

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