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Article: Bestowing the secondary market kiss: forlorn frogs clamor for a better way. (bond brokers and insurance industry seek better ways to price and distribute secondary municipal bond insurance contracts) (Credit Enhancement Supplement)
- Article from:
- The Bond Buyer
- Article date:
- March 30, 1992
- Author:
CopyrightCOPYRIGHT 1992 SourceMedia, Inc. This material is published under license from the publisher through the Gale Group, Farmington Hills, Michigan. All inquiries regarding rights should be directed to the Gale Group. (Hide copyright information)
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The shadowy market for secondary municipal bond insurance was thrust into the light in recent weeks when dealers and investors complained loudly that bond insurers' pricing and methods of distribution were unfair.
Investors decried the practice of unevenly distributing the supply of secondary market insurance, saying that giving certain parties a preference based on existing relationships amounted to a specialized dissemination of insider information. And earlier this month, buyers complained that prices for the valuable stuff had been raised without notice.
The bond insurers countered that demand so overwhelms supply that the vast majority of the ...