Barron's Penta Cites Evercore Wealth Management on New York Bonds

May 24, 2010

Penta, the Barron's publication focused on private investors with $5 million or more, quoted Evercore Wealth Management's fixed income research team in the article "Where to Find Safe Muni Bonds."

Evercore recommends New York State Personal Income Tax bonds, known as PIT bonds, which are revenue bonds issued for entities such as the New York State Dormitory, Thruway and Housing Finance authorities, according to the article. The bonds have a "poison pill" mechanism, whereby toll revenues, for example, can't be used by the state until receipts are appropriated for debt service.

The bonds are preferable to New York general obligation issues and appropriation bonds which have a downside political risk, albeit not a risk of default, said Howard Cure, director of muni research at Evercore Wealth Management.

"In New York, they've got a lame-duck governor under siege," said Cure. "Last year, they couldn't figure out who ran the Senate. And the budget is late."

The 5% New York State Dormitory non-callable bonds due 2015 recently yielded 3%.