Overview

Founded in 1995, Sound Capital Management, Inc. (“SCM”) is an independent investment advisory firm dedicated solely to the structured investment and municipal derivative markets.  The firm’s primary role and responsibility is to guide the municipal issuer in making sound decisions regarding the investment of bond proceeds. 

In today’s municipal market, an issuer of debt must consider many factors when making investment decisions.  SCM works closely with each issuer to gain a complete understanding of the issuer’s requirements and then guides the issuer in following an investment strategy based on their particular investment parameters.  SCM routinely handles both relatively simple and the most technically complex structures seen in the market today.  We understand and have worked with intricate structuring considerations, which allow us to suggest creative solutions to some of the more complicated debt investment structuring situations.  To our knowledge, no other investment broker can offer such a high level of competence and innovative experience in the municipal investment arena.

Since the firm’s inception, SCM has been successful at attracting clients of various sizes and types.  The firm has served issuers of tax-exempt debt in 44 states.  Our clients represent virtually every type of tax-exempt issuer, including:

Broad Experience

SCM’s transaction volume since 1995 exceeds $45 billion in total par/notional amount.  Invested amounts have ranged from $333,000 to $800,000,000.  The adjacent table depicts our yearly transaction experience by number and par amount over the past five years.  This experience includes interest rate swap transactions, interest rate caps and floors, escrow restructuring and escrow defeasance utilizing open market securities and forward delivery agreements, and the reinvestment of various bond proceeds into guaranteed investment contracts, repurchase agreements, and forward delivery agreements.

SCM’s complete transaction list is found in Exhibit A.

Highly Qualified Personnel

All of SCM’s professional employees are involved in providing the services we offer.  Whether we are providing advice and services on straightforward investments or suggesting creative solutions to optimize escrow returns, there are at least two professionals working on each transaction at any given time. 

The two managing partners, Johan Rosenberg and John Trefethen, founded SCM in 1995 after having worked as financial advisors to state and local governments.  As financial advisors, they assisted clients with capital budget planning, debt structuring and sizing, quantitative analysis including numerous complex cash flow analyses and arbitrage rebate calculations, disclosure documentation, rating agency presentations, bond marketing, term and pricing negotiations, and closing proceedings.  They also developed the investment advisory branch at their previous place of employment.

Over the past ten years, Mr. Rosenberg and Mr. Trefethen have built SCM into one of the preeminent municipal reinvestment broker/advisor firms in the United States.  Their combined skills of having strong quantitative backgrounds in municipal finance and familiarity with various municipal investment products have allowed them to be highly effective at structuring investments that are very advantageous to issuers.

Independence

SCM is an independent investment advisor.  This means that SCM is not affiliated with any one investment product or provider.  Thus, we are not biased toward any particular type of investment product or strategy and we do not limit the options available to an issuer.   The firm offers a full range of choices to each client and then recommends a course of action based solely upon the individual client’s needs and legal requirements.

SCM runs a completely competitive bidding process where every qualified provider has an equal chance of winning.  We have no special relationships that could influence the outcome.

ISDA Member

Sound Capital Management is a current member of the International Swaps and Derivatives Association (ISDA), which is the global trade association representing over 600 institutions that are the leading participants in the privately negotiated derivatives industry.  ISDA encourages the development of the privately negotiated derivatives business by promoting standard documentation, sound risk management practices, and high standards of professional conduct.  ISDA also educates members on the legislative, regulatory, and operational issues affecting the negotiated derivatives business.