EFTA01378358.pdf

Municipal Credit > Investment Grade NYC Transitional Finance Authority (TFA), NY Subordinate Future Tax Bonds Updated: Oct 31, 2015 Trade Idea: o Buy NYC Transitional Finance Authority, NY Subordinate Future Tax Bonds. This is a name specific recommendation. The credit provides solid carry with little downside risk but we do not expect spreads to grind tighter. Investment Rationale: Security: The bonds are secured by New York City personal income (PIT) and sales tax revenue. Sales taxes are only available to the Authority if PIT revenues fall below statutorily specified debt service coverage levels. o Bankruptcy remote with perfected security interest. o Insulated from New York City fiscal stress, non-impairment commitment, and no appropriation risk. Total combined PIT and sales tax revenue increased from $16 billion in fiscal year 2014 to $17 billion in fiscal year 2015. Net revenues cover actual annual senior and subordinate debt service by 8.6x and maximum annual debt service (MADS) by a solid 6.8x. Recommendation(s): View Trade Horizon Credit Moody's/S&P Internal Cusip Maturity Par Amount of Last Trade to Next Expected !Fitch Ratings Rating Selected AAA Curve Issuance Maturity Buy 12 Months NYC AatrAANAAA AA+tStable 64971WESS8 2/01/2038 44.7 million •32 2.6b in FY1S, Transitional $2.6b in FYI?. Finance and $2.6b In Authority. NY FY18 Subordinate Future Tax Bonds Deutsche Asset 71 & Weah Management CONFIDENTIAL - PURSUANT TO FED. R. CRIM. P. 6(e) DB-SDNY-0075527 CONFIDENTIAL SDNY_GM_00221711 EFTA01378358