COFINA: Not Just Another Sales Tax Bond

Summary

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CreditSights’ Senior Municipal Credit Analyst, John Ceffalio and Senior Municipal Strategist, Patrick Luby host COFINA: Not Just Another Sales Tax Bond.

Puerto Rico’s sales tax bonds, known as “COFINA,” are among the most actively traded bonds in the municipal market. The bonds are unrated and are widely held in high yield funds. COFINA has already defaulted and restructured once–is there still credit risk? Will the bonds rally or will they sell off as Puerto Rico’s other bonds are restructured? Can the Puerto Rico economy sustain this debt over the long haul?