October 5, 2011
For Immediate Release
Treasurer Cowell Saves NC Nearly $22.5 Million with Bond Sale
Refunding will save the state approximately $22.5 million in debt service costs
RALEIGH – State Treasurer Janet Cowell awarded $368 million of limited obligation refunding bonds today. The refunding will save the state approximately $22.5 million in debt service costs. Bonds are similar to home mortgages, in that government projects can be refinanced when interest rates are lower.
“One of our responsibilities in the State Treasurer’s office is to monitor these types of refinancing opportunities,” said Cowell. “The current market allowed us to take advantage of low financing costs to save money for the state’s taxpayers.”
The bonds were originally issued in 2003 through 2005 and used to pay for correctional facilities, higher education and other state projects. The bonds were awarded to Goldman, Sachs & Co., who submitted the most favorable of the six bids received. Goldman offered a true interest cost of 2.664 percent.
In connection with the sale, Standard & Poor’s, Moody’s Investors Service and Fitch Ratings, the three top rating agencies, all affirmed the rating on the limited obligation bonds at one level below the state’s “AAA” general obligation bond rating.