Montefiore Health System Finances $685 Million Through DASNY

ALBANY, N.Y. -- Gerrard P. Bushell, Ph.D., President & CEO of the Dormitory Authority of the State of New York (DASNY), announced today that the Montefiore Obligated Group has issued $685 million in bonds through DASNY, in a financing led by the Bank of America Merrill Lynch. 

The bonds will be used to refinance certain existing debt and to provide reimbursement for certain strategic investments, enabling Montefiore to exit the Federal Housing Administration’s (FHA) mortgage insurance program. The bonds were rated BBB by Standard & Poor's and Baa2 by Moody’s. ACA Financial Guaranty Corporation provided bond insurance on a portion of the bonds. This is Montefiore’s inaugural bond issue based on its own investment grade bond rating.  

The $685 million issued by DASNY on behalf of Montefiore Obligated Group was offered as a $309 million tax-exempt series and a $376 million taxable series. In addition, Montefiore issued $482 million on its own. In total, Montefiore raised $1.17 billion in the capital market. 

Utilizing this hybrid tax-exempt/taxable financing structure through DASNY allowed Montefiore’s financing to be structured in a way to appeal to the greatest range of investors. Montefiore chose these various financing vehicles to tap additional capital and implement a flexible financial structure that supports Montefiore’s growth as one of the nation’s leading academic health systems. 

“By offering a hybrid tax-exempt/taxable financing structure, we are better able to deliver for our clients when they head to the market,” said Dr. Bushell. “Through our internal One DASNY initiative, we have modernized our processes, enabling DASNY to serve our clients with greater flexibility and quicker execution of their financial transactions.”