No CUSIP’s for Bank Placements

By |November 7, 2017|

There may not be a tax-exempt bond market after the end of this year, but under the MSRB's latest proposal, bank direct placements will continue to be exempt from CUSIP registration requirements. This may sound like something only lawyers would care about, but it's a very good development for hospitals and other muni borrowers.

Tax Reform: Hospitals Shouldn’t Panic

By |November 5, 2017|

The House proposal to end tax-exempt debt and the upcoming Senate bill to change corporate tax rates are wreaking havoc in the municipal debt markets. As emails from bond underwriters and lawyers exhort hospitals to rush and beat the December 31 deadline, we discuss what CFO's should be doing instead.

Were Your Bonds Priced Below Market?

By |October 10, 2017|

With secondary market trading data from EMMA, hospitals have another tool to check yields on their bonds and see if they left money on the table. After reviewing 275,000 trades from bond issues going back to 2015, we share our findings and some tips on how to ensure best pricing.

Modern Healthcare: HFA Discusses ACA Repeal

By |September 20, 2017|

In the September 20 article "Hospital stocks advance even as ACA repeal vote looms", HFA Partners was asked to discuss the impact of a potential repeal of ACA on the hospital bond markets and hospital access to debt.

Fitch Places 33 Hospital Ratings on Watch

By |September 10, 2017|

Fitch Ratings placed 12% of its hospital and health system bond ratings on rating watch in connection with the agency's announcement last week that it is revising its criteria for evaluating not-for-profit hospitals. The changes are relatively evenly distributed between neutral, negative and positive.

Fitch Announces Revised Hospital Rating Criteria

By |September 6, 2017|

Fitch Ratings today proposed new rating criteria that will affect 15% of the approximately 280 not-for-profit hospitals and health systems the agency currently covers. Most hospitals will be hard-pressed to determine if the new criteria will result in a upgrade or a downgrade.

SEC Cracks Down on Muni Failures to Disclose

By |August 24, 2017|

The SEC crackdown on municipal continuing disclosure, once described by an issuer as a monumental waste of resources, has gone to the enforcement phase with two MCDC settlements so far this year. For the many muni borrowers who spent time and money self-reporting under the MCDC initiative, the two enforcement actions to date may be disappointing.

The Death of Libor and Its Impact on Hospitals

By |August 7, 2017|

Last week, UK regulators announced the plan to abandon the controversial Libor benchmark by 2021, and a group within the Bank of England started working on potential replacements. Given how entrenched Libor is in the bank markets and in interest rate swaps, the transition is sure to cause hospitals some headaches.

2017 Hospital Bond Issuance Update

By |August 2, 2017|

After a slow start, hospital tax exempt bond issuance picked up in the second quarter of 2017, but still lags behind 2016 record volumes. In a reversal from last year, AA borrowers are conspicuously absent from the borrowing scene.

HFMA: Refunding Bonds to Optimize Savings

By |June 17, 2017|

In the Summer 2017 edition of the HFMA Strategic Financial Planning newsletter, we offer a primer to cover the basic structures hospitals use to refund tax-exempt bonds and maximize savings, including various types of advance refunding before first call date.

MSRB: No CUSIPs for Bank Placements

By |June 5, 2017|

In response to market uproar, the Municipal Securities Rulemaking Board has revised its draft amendments to Rule G-34 and now proposes to exempt bank placements from registration. If adopted, the amendments would be a win for hospitals and other borrowers that rely on placements for a portion of their debt structure.

HFA Interviewed by Modern Healthcare

By |May 18, 2017|

In the May 17 article 'Fast Cash Handy for Those Hospital Fixer-Upper Projects', HFA Partners was asked by Modern Healthcare to discuss recent hospital bond issues and the state of the healthcare debt markets.

Credit Spreads and Cost of Debt

By |May 12, 2017|

When planning debt issuance, hospitals and other borrowers try to anticipate the direction of interest rates, but they should also pay attention to credit spreads. In the last several years, spreads have not only declined but also compressed, which has cut borrowing costs and made rating upgrades less valuable.

Making the IRMA Exemption Work For You

By |May 12, 2017|

Three years after its adoption, some not-for-profit hospitals are still unfamiliar with the SEC's Municipal Advisor Rule that restricts the information broker-dealers can discuss with them. Today we review the rule and its exceptions, and discuss the steps needed to take advantage of the IRMA exemption.

MSRB Gets Pushback on Bank Placements

By |April 4, 2017|

The Municipal Securities Rulemaking Board's latest attempt to regulate direct bank purchases and other private placements by requiring the same registration as public bond offerings, is getting a rare response from market participants: unanimous pushback.

SEC Proposes Bank Placement Disclosure

By |March 2, 2017|

The Securities and Exchange Commission is proposing to add certain financial obligations to the material events which municipal obligors must disclose under Rule 15c2-12. Although the SEC has yet to clarify what constitutes a financial obligation, its stated intent is to capture bank placements, where disclosure has been limited.

2016 Sets Hospital Bond Issuance Record

By |February 23, 2017|

Hospitals staged a massive return to the debt markets in 2016 as public bond issuance jumped 87%, more than any other municipal sector. The increase affected all rating categories, including lower investment grade borrowers who had previously stayed on the sidelines.

Hospital Ratings Mostly Stable in 2016

By |February 2, 2017|

Fitch Ratings reports that in 2016, the agency saw the highest number of public finance upgrades of the last 10 years, outnumbering downgrades more than 2:1. But in the not-for-profit hospital sector, the ratio of upgrades to downgrades was down from 2015 and continues to vary significantly between rating agencies.

Prepaying Bank Direct Placements

By |January 4, 2017|

Hospitals looking to pay off or refinance tax-exempt debt are finding out that while public offerings offer limited options, bank direct purchases and other forms of private placements are more conducive to early redemption. With an understanding of prepayment formulas and market practices, hospitals can reduce or even eliminate penalties and realize substantial cash savings along the way.

SEC Ends MCDC Settlements

By |December 14, 2016|

Described by one issuer as a monumental waste of resources, the Municipalities Continuing Disclosure Cooperation initiative is about to get much less cooperative. SEC officials said they've ended settlements with underwriters and issuers that voluntarily disclosed, and the Commission is now shifting its focus to those that didn't.