Public pension disclosure and transparency has improved dramatically since the Global Financial Crisis, thanks to the combined focus of credit analysts, accounting rule makers, and securities regulators. In the coming year, we’ll find out if they’ve done enough to protect municipal bond investors.
In a new article, BAM’s healthcare underwriting and surveillance team discussed the ways in which the sector’s credit quality could be impacted by new policies designed to address the Federal government’s long-term budget challenges.
The January 21st edition of BAM’s Weekly Update eNewsletter contained the following response to investor questions about BAM’s insured portfolio and the Los Angeles County wildfires: “BAM expresses our sympathy and support to all investors, issuers, and counterparties that have been impacted by the Los Angeles wildfires. Our surveillance team continues to monitor the situation, … Continued
Ttates and local governments are helping to execute the largest wave of U.S. infrastructure investment in a generation. As demonstrated in the wake of the COVID panemic, insured bonds offer investors stable ratings, increased liquidity and less volatility. Amidst continuing questions about the outlook for inflation, economic growth, and climate change, bond insurance remains a … Continued
Healthcare is essential to all Americans and highly important to the economy. But a granular, issuer-specific approach to selecting investments in the sector is crucial, particularly because financial stress across the industry has forced administrators to re-think their operating assumptions and business models. Financial performance and bond ratings are likely to remain volatile and inconsistent as the sector emerges from a range of post-pandemic issues.
Municipal bond investors are paying more attention to the credit risks posed by public pension and other retirement liabilities. Municipal finance officers should prepare to address those questions when they apply for bond ratings and sell new issues.
Monitoring the steps state and local government bond issuers are taking to manage in a volatile labor market can give investors early insight into how pensions may impact credit quality in the future.
The Covid-19 pandemic spurred new demand for insured municipal bonds, and the strong interest appears poised to continue as investors team with states and local governments to help execute the largest wave of U.S. infrastructure investment in a generation.
Understanding the risks to municipal credit quality posed by public sector commitments to retirees requires a dynamic analysis that includes considering the effect of prevailing and anticipated interest rate and inflation environments on pension funding.
That analysis is particularly important now: Fueled by recent economic stimulus measures and supply chain issues, inflation is picking up. Amidst uncertainty over whether the uptick in inflation is transitory or part of a longer-term trend, this paper examines the credit implications related to U.S. state and local government pensions of different scenarios for interest rates and inflation.
This panel looks at current trends in the municipal bond market as one of the best-perform- ing fixed-income asset classes in 2021. It shares insights into the credit strength of cities, counties, and other municipal borrowers as these emerge from the pandemic and discusses the potential impact of several Federal policies on the performance of municipal bonds going forward.
As the economy recovers from the COVID pandemic, pension issues should remain central for municipal bond investors, because state and local governments’ fiscal policy decisions could have long-term implications. This paper explores the pension risk implications of some of the actions governments may take in response to revenue declines.
The first bear market in U.S. stocks in more than a decade is almost certain to cast a long shadow over U.S. public pension funds.