Chapter Holds Initial Central Jersey Breakfast Series Meeting
Expert Municipal Bond Market Outlook Presented by PNC Strategist Tom Kozlik
The NY/NJ Chapter recently held the first
of a planned series of breakfast meetings designed specifically to enhance the professional development of financial
decision makers at community banks in the central New Jersey region. The meeting was held at the Radisson Hotel
of Freehold on January 14, 2016 in Freehold, NJ. The Chapter holds regular monthly meetings at the Stony Hill
Inn in Hackensack, NJ which primarily serve community bankers in the northern New Jersey and metropolitan
New York regions. Two additional central New Jersey breakfast meetings are scheduled on Thursday, March 10, 2016
and Thursday, May 5, 2016 which will also be held at the Radisson Hotel of Freehold.
Chapter President Brian McCourt welcomes attendees to the Chapter's initial Central New Jersey Breakfast Series meeting.
Featured speaker Tom Kozlik from
PNC Capital Markets presented a Municipal Bond Market Outlook.
Tom Kozlik, Municipal
Strategist from PNC Capital Markets, presented Municipal Bond Market Outlook: 2016, Focus
on State and Local Government Credit Quality.
Tom publishes municipal bond market commentary,
evaluates the strengths and weaknesses of municipal bond market credit profiles and related
investment portfolios. Tom discussed the current economic trends affecting the municipal market.
Among the key themes Tom noted is that overall municipal bond credit conditions at the start of 2016
are favorable. He pointed out that an increasing number of credit profiles have the potential
to improve during 2016 and there is no looming crisis affecting the overall municipal credit market.
Tom explained how local governments are facing a “new fiscal reality” resulting from local tax revenue
increases falling below pre-recession trends which has resulted in issuers facing credit quality downgrades.
Tom summarized a number of key factors
affecting the municipal market. Tom expects municipal credit volume to range from $325 to $375
billion during 2016 as compared to $398 billion in 2015. He noted that although state and local
governments generally have well-funded pension plans, funding has failed to recover to pre-crisis
levels. He cautioned that local government downgrades are occurring at an above-average pace and
that investors should continue to monitor credit profiles for signs of structural imbalance.
He also feels that municipal investors today are less prepared for the next recession than for
the 2009 market crisis.
Following his expert
analysis and commentary, Tom answered a series of provocative questions from the financial managers
Topic and Speaker
Municipal Bond Market Outlook: 2016
Attendees listen to the presentation by Tom Kozlik after enjoying a hot and cold breakfast buffet.
Financial managers learn keen perspectives on the municipal bond market at the Central Jersey breakfast meeting.