Pricing Municipal Bonds Through a Negotiated Sale Process

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Target Audience

  • Broker-dealers 
  • Municipal securities issuers
  • Municipal advisors

Learning Objectives

At the end of this course learners will be able to:

  • Identify the components of the negotiated sales process to price municipal bonds in the primary market; and
  • Associate the MSRB rules applicable to the negotiated sale process in the primary market.

Course Outline

1. MSRB Rules applicable to the negotiated sale process in the primary market.
a. MSRB Rule G-8: Books and Records to be Made by Brokers, Dealers, and Municipal Securities Dealers
b. MSRB Rule G-11: Primary Offering Practices
c. MSRB Rule G-14: Report of the Sales or Processes
d. MSRB Rule G-17: Conduct of Municipal Securities and Municipal Advisory Activities
e. MSRB Rule G-21: Advertising
f. MSRB Rule G-30: Prices and Commissions
g. MSRB Rule G-32: Disclosures in Connection with Primary Offerings
h. MSRB Rule G-33: Calculations
i. MSRB Rule G-34: CUSIP Numbers, New Issue, and Market Information Requirements
j. MSRB Rule G-42: Duties of Non-Solicitor Municipal Advisors

2. Beginning the negotiated sale pricing process
a. Preliminary Official Statement
b. Ordering CUSIP Numbers

3. Executing Marketing Plans
a. Marketing plan considerations
b. Institutional marketing
c. Retail marketing

4. Market Update
a. Market update considerations
b. Market update conference calls

5. Pre-Pricing Process
a. Negotiating Expenses
b. Consensus Scale

6. Order Period
a. Preliminary Pricing Wire
b. Orders
c. Evaluation Order Book

7. Repricing Proposal
a. Order Book Review
b. Negotiation of Final Pricing
c. Verbal Award

8. Bond Allotment
a. Confirmation
b. Allotment Process
c. Wires

9. Bond Purchase Agreement (BPA)
a. Final Pricing Information
b. BPA Execution
c. Final Award
d. Final Pricing Wire
e. DTC Eligibility
f. EMMA® Submission

10. Closing
a. Bond Closing Documents
b. Transaction Closing
c. Post-Sale Reports

11. Assessment