Subscribers

Municipal debt backed by airlines takes off

Those backed by American Airlines' parent has gained 500% in two years

[NEW YORK] Municipal debt backed by American Airlines' parent has gained more than 500 per cent in two years, rewarding investors who withstood AMR Corp's bankruptcy filing and a failed suit to block a merger that would create the world's biggest carrier.

Munis backed by airlines and sold to finance facilities such as gates, and debt issued to pay for airports' own projects are benefiting as an expanding US economy spurs travel spending, said Vikram Rai, a strategist at Citigroup Inc. Airport muni debt is having its best rally since the start of 2012, Bank of America Merrill Lynch data show.

Some American Airlines securities are trading at record highs after reaching as low as 18.9 cents on the...

BT is now on Telegram!

For daily updates on weekdays and specially selected content for the weekend. Subscribe to t.me/BizTimes