Southwest bond volume growth trails nation amid Texas dip

Municipal bond issuance growth slowed in the Southwest where it was up just 8.1% year-over-year in the first half of 2025 to $54.9 billion as Texas bond sales dipped.

Nationwide volume was up 14.7% at $281.8 billion with the Southwest lagging the Far West, Midwest, and Northeast regions, which had bigger gains, according to LSEG Data.

At 2024’s half point, issuance in the eight-state Southwest region , Wells Fargo and other investment banks after they withdrew their memberships in the Net-Zero alliance, which seeks a transition to net-zero greenhouse gas emissions by 2050.

The reviews could have led to banks being banned from underwriting state and local government debt under a Texas law that bars contracts worth $100,000 or more with companies that “boycott” the fossil fuel industry.

JP Morgan and BofA continue to be reviewed in conjunction with another Texas law that prohibits governmental contracts with companies that “discriminate” against the firearm industry.

Oklahoma, which enacted a similar firearm law that takes effect Nov. 1, has banned BofA, JP Morgan, Wells Fargo and Barclays from underwriting state and local government debt for boycotting energy companies under a 2022 law that was determined to be unconstitutional last year by a state judge. An appeal of that ruling is pending before the Oklahoma Supreme Court.

BofA ranked second behind Goldman Sachs for top senior manager in Oklahoma for 2025’s first half on the strength of a $400 million special facility revenue bond issue backed by American Airlines and issued through Trustees of the Tulsa Municipal Airport Trust.

Bond counsel rankings for the Southwest region have McCall Parkhurst & Horton on top for the first half, credited with $11.24 billion of debt in 158 deals, followed by Bracewell with $5.37 billion in 64 deals. Both firms ended 2024 in the same positions. Gilmore & Bell moved up to third place from fourth in 2024 with $5.138 billion of bonds in 111 deals.

Hilltop Securities continued its dominance as the region’s top financial advisor, credited with nearly $14.7 billion of debt in 173 deals. PFM Financial Advisors remained in second place with $3.75 billion in 34 deals and Specialized Public Finance, which was in fifth place last year, ranked third with $3.59 billion in 76 deals.

Estrada Hinojosa, which was acquired a year ago by Texas Regional Bank, fell from third place in the region for 2024 to 12th place in 2025’s first half. Noe Hinojosa, president of TRB’s Municipal Capital Markets Division, said the Dallas-based firm will be participating in big bond deals in the coming months.

“Our pipeline is stronger than I’ve ever seen in the history of the firm,” he said, adding market volatility and a barrage this year of Texas bills seeking to restrain local government and school debt and taxes put the brakes on some issuance in the first half of the year.