Texas Insider Report: AUSTIN, Texas – Today’s sale of $9.8 billion in one-year cash flow notes from the state of Texas was very well-received by the financial community. High demand for the notes drove the interest rate down to 0.27 percent – the lowest interest rate the state has received on its annual short-term notes.
“Texas had a very successful sale and the demand for these notes shows investors’ high confidence in Texas’ recovering economy and the state’s solid record of conservative fiscal management,” Texas Comptroller Susan Combs said. “Buyers bid about $31 billion – more than three times the amount offered for sale. And the resulting low interest rate is very beneficial to the state.”
Proceeds from the notes, known as Tax and Revenue Anticipation Notes (TRANs), will be used to distribute state funding to public schools early in the upcoming fiscal year and to help state government manage its cash flow between the start of the fiscal year and the arrival of tax revenues later in the year.
The TRAN notes sold today will be repaid Aug. 31, 2012.