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June 11, 2013 /PRNewswire/ - RBC Capital Markets' Municipal Markets group hosted the industry's first-ever municipal conference focused on SIFMA-Indexed Floating Rate Notes (FRNs) on
Friday, June 7, 2013. The event, held at the Conrad Hotel in
New York City, brought together over 180 of the industry's top investors and issuers to discuss the emergence of FRNs following the recent period of market challenges.
"The financial markets have significantly evolved over past several years, and the municipal finance industry has responded accordingly," said
Mark Maroney, Head of U.S. Rates, Municipals and Securitized Products at RBC Capital Markets. "FRNs have been a common form of financing in the corporate and asset-backed debt markets to gain access to variable interest costs of funds without risks to the short-term bank market, and now the municipal industry is following suit by adopting the product within our own market."
Chris Hamel, Head of the Municipal Finance group at RBC Capital Markets, added, "Within our client base, we have seen a significant uptake in interest in FRNs over the last few years, as evidenced by the 89 industry-wide FRN transactions totaling
$16 billion since 2009. Today's event convenes some of the biggest players in the space to further examine the opportunities and challenges in our market and we are thrilled to host this opportunity."
Following a welcome address from Hamel, keynote speaker
Mark Muller, Senior Portfolio Manager at Loews Corporation, discussed the changes in the municipal market landscape over the last five years and his view looking forward.
Chris Mauro, RBC's Head of U.S. Municipals Strategy, then discussed the evolution of the short-term market and
Tom Carlson, Director within the Municipal Capital Markets group, presented an overview of public FRNs. Two panel discussions on the market followed.
The "Depth and Longevity of the Market" panel put forth top investors in the market to offer their perspectives on the use of FRNs over the long-term. Moderated by
Jaime Durando, RBC's Managing Director and Head of Municipal Syndication, panelists included:
Lyle Fitterer, Managing Director, Wells Capital Management
Justin Schwartz, Portfolio Manager, Vanguard
James Pruskowski, Managing Director & Portfolio Manager, Head of Municipal Institutional & Wealth Management, BlackRock
The investor panelists discussed how FRNs are an attractive asset because they provide protection against interest rate risk, particularly in the current environment.