Coming Soon: New Detroit Bond Rating
City awaits first post-bankruptcy bond rating, readies to sell bonds for exit financing.
Detroit city officials are waiting for rating agencies to determine essentially how much it will cost to borrow $245 million for the so-called “exit financing” that was approved as part of Detroit’s post-bankruptcy financial plan.
The city’s original plan called for borrowing an additional $30 million, but the city was able to lower that amount because of fee reductions from lawyers and consultants involved with the bankruptcy case, says spokesman John Roach.
City Finance Director John Naglick says he’ll know within a day what rating the bonds will have. That rating will help determine the interest rate the city will pay investors who purchase the bonds. Barclay’s Bank financed the bonds during the bankruptcy with the agreement the city would re-sell them on the private market this year.
Naglick says the bonds will be publicly sold on Aug. 19. Before then, Mayor Mike Duggan will attend information sessions for potential investors. One will be held Aug. 11 in Detroit, and another on Aug. 13 in New York City.
