Moody's Investors Service said yesterday that investors holding defaulted municipal bonds sold by Alabama's Jefferson County and other local governments will recover less than the average 80 cents on the dollar of recent decades, Reuters reported yesterday. In addition to Jefferson County, whose sewer system creditors have signed off on a pending agreement that promises bondholders about 60 cents on the dollar, Moody's analysts led by Cristin Jacoby said that recoveries in Detroit, Harrisburg, Pa., and California's Stockton and San Bernardino will likely fall short of 80 percent. Bondholders appear to be losing expected safeguards when competing with other creditors in municipal bankruptcies, Moody's said.
