Banks Eager To Do Business With Local Gov’t
(Wall Street Journal) — Time was running out for the Orange County School Board. A $105 million debt deal was about to expire, triggering painful penalties for the approximately 175,000-student district in the Orlando, Fla.-region. Along came Wells Fargo & Co. with a deal that avoided the penalties: Wells bought the $105 million debt from investors and negotiated new terms with the district. “We got a good deal,” says Richard Collins, the district’s chief financial officer. Such deals are cropping up in many cities and states across the U.S. Teams of bankers are blanketing the country pitching transactions like the one in Orange County, as well as traditional loans, to government officials, people in the industry say. While big banks still are tight-fisted with many homeowners and small businesses, they see cities, states and schools as one of their least-risky ways to put to work some of the piles of cash that have amassed on their balance sheets.