As we've been reporting this week - sales of the 20 million dollar Municipal Bond have been brisk - so much so that the first ten million dollar tranche is over-subscribed. That means the council has gotten pledges of as much as 18 million when the first tranche is only 10 million dollars.
But today the mayor quelled some of that enthusiasm - he said there are still some bonds on offer - and prospective buyers should not be dissuaded:
Darrell Bradley - Mayor, Belize City Council
"The sales opened on Monday, and by Wednesday, which is today, a significant amount of interest has been expressed, and people have submitted applications to the Central Bank of Belize. The City Council expects that the bond will be as indicated by the level of interest, persons who have phoned in, and persons who actually submitted applications to the Central Bank, that the bond will be oversubscribed. But we want to indicate to persons in the public that they have until December 24 to submit applications to the Central Bank, and then we will decide exactly what we will do. So, there is still availability in terms of the bond. There's still availability with all the tranches, and we are advising members of the public that unless we advise otherwise, we're still taking applications to the Central Bank of Belize. I indicated to you that there are still portions of the first tranche which are still unsubscribed. So, we have seen heavy interest in the 5-year; we've seen heavy interest in the 10-year. We've not seen as heavy an interest in the 2-year."
Jules Vasquez
"How do you interpret this abundance of interest in the municipal bond?"
Darrell Bradley
"Well, I interpret it 2 ways. I think that there is - the market is working in our favor. There are low returns at the bank in terms of interest rates, and persons have a lot of cash in the economy. And so, the bond provides an opportunity for these persons to take a risk, but a reasonable, calculated risk, and get a high yield on their monies, which do nothing for them in the bank."
The Tranche two bond offering for five million dollars will be launched in four to six months followed by the final 5 million in tranche 3 in another 4 - 6 months.
City hall will not be able to access the proceeds from tranche one until when the offer closes after Christmas.
Discussing the letter of caution sent out by BML's attorney warning prospective buyers of a pending 2.4 million dollar court judgment against City Hall - Bradley says he believes that has been a non-factor.
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