The state of California sold a whopping $6.4 billion in bonds today, a financial move that should help to give a positive spin to efforts to sell state bonds privately to finance the state's beleaguered stem cell research agency.
California was originally scheduled to sell $4 billion in general obligation bonds, but Bloomberg News' Jeremy Cooke reported that dealers boosted the sale by 64 percent and completed it a day earlier than expected.
Individual investors snapped up $3.2 billion in bonds before they were offered to institutional investors.
Interest rates were about 0.2 percent higher than similar securities and ranged from 3.2 percent to 6.1 percent, Cooke reported.
The high interest rates made the bonds attractive but will cost the state more.
CIRM plans to use taxable state bonds, as opposed to the tax-exempt bonds that were sold today. That means they will have to offer higher interest rates than those offered today.
The stem cell agency relies on state bonds for its funding. It will run out of cash next fall unless it can successfully market bonds privately. The state has told the agency it has a backlog of needs and CIRM's are well down the list.
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