Folwell announces $400M bond sale

North Carolina is one of 13 states that have a AAA rating from all major rating agencies

Eamon Queeney—The North State Journal
State Treasurer Dale Folwell

RALEIGH — State Treasurer Dale Folwell announced last week the issuance of approximately $400 million in bonds from the Connect NC bond, passed by voters in 2016.

The sale is the second of $2 billion in bonds intended to fund improvements at universities, community colleges, local parks, infrastructure projects and other projects. The total amount of interest to be paid by the state over the life of the loan is approximately $163 million. The bonds were purchased by Bank of America Merrill Lynch at an interest rate of 2.865 percent.

North Carolina continues to have a AAA bond rating from all three major national bond rating agencies, which noted the state’s strong economy, rainy day fund and conservative fiscal management.

“Continuing to have all three agencies affirm our ‘AAA’ rating is essential,” said Folwell. “This allows us to get very favorable rates, saving taxpayers millions of dollars. The credit goes to taxpayers who pay for these bonds and the General Assembly for their conservative fiscal management of the state’s finances. I’d also like to thank the staff at the State and Local Government Finance Division for their hard work on the sale.”

S&P Global Ratings noted the establishment of the first Solvency Fund to address the state’s nearly $50 billion in health care and pension IOU’s, while Moody’s Investors Service commented on the state’s strong, conservative fiscal management. Fitch Ratings noted North Carolina’s exceptionally strong ability to close budget gaps during economic downturns.