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Bond Summit – South Carolina JEDA
Discussion on High Yield Bonds
WALTER GOLDSMITH, Managing Director
1355 Greenwood Cliff, Suite 400
Charlotte, NC 28204
Office: (704) 926-2453
Email: wgoldsmith@firsttryon.com
MIYUN CHO FELLERHOFF, Managing Director
One North Wacker Drive, Suite 2000
Chicago, IL 60606
Office: (312) 596-1532
Email: mcfellerhoff@ziegler.com
KIMBERLY WITHERSPOON, Shareholder
1 North Main Street, 2nd Floor
Greenville, SC 29601
Office: (864) 240-3255
Email: kwitherspoon@hsblawfirm.com
Agenda
1
I. Introductions
II. Panel Discussion
FIRM OVERVIEW
• Provide business, litigation and financial legal services to local, regional, national and international clients
• 112 attorneys in Charleston, Columbia, Florence, Greenville and Myrtle Beach
• Oldest and one of the most extensive public finance practices in SC
FIRM OVERVIEW
3
FIRM OVERVIEW
• 11 public finance attorneys• Advise private colleges and universities,
foundations, nonprofit hospitals, senior living communities and nonprofits
• Assist in mergers, acquisitions, expansions, affiliations and capital improvements
• Closed over $1.58 billion of bond transactions in 2018
PUBLIC FINANCE PRACTICE
4
B.C. Ziegler and Company | Member SIPC & FINRA
ZIEGLER INVESTMENT BANKING
PRESENTED BY
Miyun Cho FellerhoffManaging Director and Practice Head312-596-1532mcfellerhoff@ziegler.com
ZIEGLER GENERAL MUNICIPAL & STRUCTURED FINANCE
October 24, 2019
ABOUT US
ZIEGLER is a privately held, national boutique investment bank, capital markets and proprietary investments firm. Specializing in the healthcare, senior living and education sectors, as well as general municipal and structured finance, enables us to generate a positive impact on the communities we serve.
FUNDS
INVESTMENT BANKING CAPITAL
INVESTMENT BANKING
ADVISORY
CAPITAL MARKETS +
INVESTMENT BANKING
CAPITALMARKETS
PROPRIETARY INVESTMENTS
Advisory, financing and capital planning solutions in healthcare, senior living and educational sectors as well as general municipal and structured finance
Active participant in municipal sales and trading including public, tax-exempt, taxable, private placement and preferred trading markets
Providing opportunities for investors in senior living, healthcare services & technology solutions
6
• Founded in West Bend, WI in 1902, Ziegler began building its reputation for financing not-for-profit organizations with a loan to Holy Angels Catholic Church in 1913
• Today, Ziegler is a full-service, privately-held specialty investment bank and broker dealer providing its clients with capital raising, equity and fixed income sales & trading, and research
COMMITMENT TO PUBLIC FINANCE
7
NATIONAL FOOTPRINT
8
CHICAGO, ILHeadquartersOne North Wacker DriveSuite 2000Chicago, IL 60606
NEW YORK2 Grand Central Tow er 140 East 45th StreetSuite 2200New York, NY 10017
NASHVILLE, TN 150 3rd Avenue SouthSuite 1150Nashville, TN 37201
established
1902
number of associates
140
Registered offices nationally
23
HEADQUARTERED at One North Wacker Drive in Chicago with regional and branch offices throughout the U.S., Ziegler provides its clients with capital raising, strategic advisory services, fixed income sales & trading and research. .
STRUCTURE & SERVICES
9
Clients: Institutional Investors
HEALTHCARE SENIOR LIVING EDUCATION STRUCTURED FINANCE
INVESTMENT BANKING
• Advisory Services• Bond Financing• Corporate Finance• Private Placements• Seed Capital
CAPITAL MARKETS
• Primary Fixed-income Underwriting
• Syndicate Management
• Secondary Institutional Sales & Trading
• Private Placements• Taxable & Tax-exempt• Credit Focused
ADDITIONAL SERVICES
• FHA/HUD Financing Programs
• Research
PROPRIETARY INVESTMENTS
• Providing opportunities for investors in
• Senior Living• Healthcare
Services• Healthcare
Technology Solutions
PROVIDING CLIENTS with capital raising, strategic advisory services, equity and fixed-income sales & trading, and research, while specializing in healthcare, senior living and education sectors.
GENERAL MUNICIPAL & STRUCTURED FINANCE
10
•Ziegler added its General Municipal and Structured Finance (“GMSF”) practice in May of 2014. Prior to joining Ziegler, the GMSF team worked together at another private investment bank. The team joined Ziegler because of the depth and breadth of Ziegler’s non-investment grade investor base.
•Each Managing Director of the GMSF team has in excess of 30 years of experience in public finance investment banking and each has extensive project finance experience in addition to decades of experience working with large municipal issuers such as the State of Illinois, the City of Chicago, the City of New York, the State of California and other large issuers as Co-Manager in the past and currently.
•Project finance transactions include waste to energy, recycling, alternative energy, and P3 projects.
•Ziegler has successfully structured, sold and closed ten municipal solid waste to re-engineered fuel transactions and has five additional transactions scheduled to close by year end 2019.
•Ziegler’s GMSF team and our underwriting and sales team have significant experience in structuring and selling “to be created” property and sales tax backed transactions.
•Ziegler underwrote over $2.6 billion and directly placed an additional $2.5 billion of securities in 2018.
GENERAL MUNICIPAL & STRUCTURED FINANCE TRANSACTION HIGHLIGHTS
11
Introduction to First Tryon Advisors
WALTER GOLDSMITH, Managing Director
1355 Greenwood Cliff, Suite 400
Charlotte, NC 28204
Office: (704) 926-2453
Email: wgoldsmith@firsttryon.com
Overview of the Firm
Overview of First Tryon Securities, LLC Founded twenty years ago and headquartered in Charlotte,
North Carolina, First Tryon Securities, LLC is a regionally focused independent, privately owned securities firm.
The firm is registered with both the Municipal Securities and Rulemaking Board and the Securities and Exchange Commission. First Tryon employs 23 registered representatives.
First Tryon Advisors First Tryon Advisors is a business of First Tryon Securities, LLC
and operates as the Financial Advisory arm of the firm.
First Tryon Advisors has a full service financial advisory practice serving the needs of cities, towns, school districts, counties, utilities, colleges/universities, hospitals and not-for-profits in the Southeast region.
First Tryon does not serve as an underwriter and only provides financial advisory services to our clients.
Municipal Sales & Trading Desk The financial advisory team at First Tryon has access to real-
time market information for tax exempt and taxable securities through our trading platform.
Our desk assists our clients when pricing bonds in the public markets – ensuring the proposed spreads provide the best deal for the client.
First Tryon’s annual trade volume exceeds $2 billion in par amount.
Office Locations The firm has offices in Atlanta (GA), Boone (NC), Charlotte
(NC), Gulf Breeze (FL), Jacksonville (FL), and Sterling (VA).
13
Gulf Breeze, FL
J ac ksonville, FL
Atlanta, GA
Charlotte, NCBoone, NC
S terling, VA
First Tryon Advisors Experience
The team at First Tryon Advisors has a tremendous amount of experience serving clients in the Southeast.
14
City of Tega Cay
Orangeburg County
Lexington Medical Center
Town of Fort Mill
Patriots Energy Group
USC Upstate
Caldwell County
Lenoir-Rhyne University
Davidson College
East Carolina University
Fayetteville PWC
Methodist University
City of N. Charleston
Chesterfield County
Fripp Island PSD
Orangeburg Regional Medical
Center
PittCounty
Queens University
City of Lincolnton
Mount Pleasant Waterworks
Town of Mount Pleasant
Charleston County
Florence W&S
City of Sumter
Dorchester County
Mason Prep
Beaufort-Jasper W&S
Authority
Town of Summerville
NC State University
Town of Pageland, SC
Cleveland County Family
YMCAYMCA of Asheville
Hilton Head Public Service
District #1
N. Charleston Sewer District
Kiawah Island Utility System
Renewable Water Resources
Duplin County
Orange W&S Authority
Town of Carolina Beach
City of Monroe
City of Charleston
Wilson County
Town of Mooresville
Appalachian State
University
Town of Blowing Rock
UNC Asheville
City of Rock Hill
Town of Weaverville
Town of Carrboro
UNC School of the Arts
Randolph County
City of AlbemarleNC A&T State
University
Wingate University
Columbus County
City of Florence
Kershaw County
Spartanburg Water
Halifax County
Burke County
Town of Coward
City of Mount Holly
Camden County
City ofDunn
City of Hendersonville
Berkeley County SD
Furman University
Town of Fletcher
City of Darlington
Polk County Transylvania
CountyWestern Carolina
University
Haywood County
Laurens County W&S Commission Greenville
Water System
Gardner-Webb UniversityTown of
Woodfin
Meredith College
Guilford College
Scotland County
Fayetteville State University
Cape Fear Valley Health System
UNC Pembroke
University of North Carolina System
NC A&T Real Estate Foundation
Town of DavidsonTown of
MatthewsStanly County
Elizabeth City State University
UNC GreensboroRandolph Hospital
Hampton Regional
Medical Center
City of Conway
City of Woodruff
Bladen County
City of Fountain Inn
Calhoun County
UNC TV
CaroMont Health
Tri-County Tech. College
Pickens County
City of Anderson
City of Greenville
Anderson County
NC Central UniversityFranklin County
City of Greensboro
Guilford County
New Hanover County
Dillon County Board of Education
City of Myrtle Beach
UNC Wilmington
Community School of Davidson
William Peace University
Town of Sullivan’s
Island
Fletcher School
Town of Leland
Clinton-Newberry
Natural Gas
Town of Surfside Beach
Iredell County
Rowan County
City of Concord
Catawba CountyTown of
CorneliusPfeiffer
UniversityCity of
Gastonia
City of West Columbia
Kershaw and Lee County
Water
Lancaster County
Natural Gas
Lancaster County W&S
District
Horry County
Darlington County
Florence County
Marion County
Greenville Tech. Charter High School
Anderson University
Abbeville County
City of Greer
City of North Augusta
City of Aiken
The Citadel Foundation
Laurens CPW
Bulloch County
City of Durham
Powdersville Water District
Dalton Utilities
DeKalb County School District
Whitfield County
Boiling Springs Fire District
City of DaltonFultonCounty
Metropolitan Atlanta Rapid Transit Auth.
City ofSuwanee
Effingham County
BryanCounty
Fulton County Schools
Catoosa County
City of Richmond Hill
CravenCounty
City of Beaufort
City of Fayetteville
Charlotte Country Day School
Long County
City of Folly Beach Berkeley
County
Murray County School District
Agenda
15
I. Introductions
II. Panel Discussion
Roadmap for Panel Discussion
Topics Current Interest Rate Environment Investor Appetite Taxable Markets Sector Specifics
– Industrial Development Bonds– Changes in Senior Living Multi-State Conduit Issuers
16
0.00%
1.00%
2.00%
3.00%
4.00%
5.00%
6.00%
7.00%
8.00%19
98
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
2018
2019
30 YR UST Average 30 YR MMD Average 30 YR UST 30 YR MMD
Long Term Rates – All-Time Low
17
Source: TM3, Treasury.gov as of October 18, 2019
Previous all-time low New all-time low
30-Year Municipal Market Data & 30-Year US Treasury Rates – Past 20 Years
Fund Flow is the net of all cash inflows and outflows going in and out of various financial assets.
Municipal bond inflows and outflows are essentially a representation of demand for fixed-income municipal securities.
MMD, a product of supply and demand, correlates closely with inflows and outflows.
So far, 2019 has been historically one-sided, with all but one week showing significantly positive inflows. Extraordinary demand for bonds and correspondingly low MMD yields makes the current market extremely appealing municipal bond issuances.
Municipal Bond Inflows & Outflows
18
3 Year Historical Inflows & Outflows
Source: TM3, Lipper as of October 18, 2019
0.00%
0.50%
1.00%
1.50%
2.00%
2.50%
3.00%
3.50%
4.00%
-5.0
-4.0
-3.0
-2.0
-1.0
0.0
1.0
2.0
3.0
4.0
5/1
1/20
166/
1/2
016
6/2
2/20
167/
13/
2016
8/3
/201
68/
24/
2016
9/1
4/20
1610
/5/2
016
10/2
6/20
1611
/16/
2016
12/7
/201
612
/28/
2016
1/1
8/20
172/
8/2
017
3/1
/201
73/
22/
2017
4/1
2/20
175/
3/2
017
5/2
4/20
176/
14/
2017
7/5
/201
77/
26/
2017
8/1
6/20
179/
6/2
017
9/2
7/20
1710
/18/
2017
11/8
/201
711
/29/
2017
12/2
0/20
171/
10/
2018
1/3
1/20
182/
21/
2018
3/1
4/20
184/
4/2
018
4/2
5/20
185/
16/
2018
6/6
/201
86/
27/
2018
7/1
8/20
188/
8/2
018
8/2
9/20
189/
19/
2018
10/1
0/20
1810
/31/
2018
11/2
1/20
1812
/12/
2018
1/2
/201
91/
23/
2019
2/1
3/20
193/
6/2
019
3/2
7/20
194/
17/
2019
5/8
/201
95/
29/
2019
6/1
9/20
197/
10/
2019
7/3
1/20
198/
21/
2019
9/1
1/20
19
$ B
illio
ns
Inflows
Outflows
30Y MMD
Investor Appetite for High Yield Munis
19
Cumulative Percentage Change in Market Value Since 2012
2019 Avg.($6.4 B)
2018 Avg.($5.4 B)
Municipal Bond Supply
Weekly Municipal Bond Issuance Volume
Source: The Bond Buyer, MarketWatch as of October 18, 2019
20
4.5
6.4
7.8
1.0 0.0 0.2
7.8
6.6
5.1
3.7
7.2 6.4
2.0
4.7 4.5 4.8
2.5
7.5
5.5
4.2 3.6 3.9
5.4 6.1
7.2
5.1
2.0
6.4
9.9
7.3
5.6
1.0
6.9 7.06.7
4.9
12.6
7.6
5.16.2
7.68.6
10.3
6.0
9.3
6.4
14
12
0
2
4
6
8
10
12
14
16
$ B
illio
ns
Wisconsin Public Finance Authority (PFA)
21
Wisconsin Legislature
22
Questions?
MIYUN CHO FELLERHOFF, Managing Director
One North Wacker Drive, Suite 2000
Chicago, IL 60606
Office: (312) 596-1532
Email: mcfellerhoff@ziegler.com
KIMBERLY WITHERSPOON, Shareholder
1 North Main Street, 2nd Floor
Greenville, SC 29601
Office: (864) 240-3255
Email: kwitherspoon@hsblawfirm.com
WALTER GOLDSMITH, Managing Director
1355 Greenwood Cliff, Suite 400
Charlotte, NC 28204
Office: (704) 926-2453
Email: wgoldsmith@firsttryon.com
23
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