Vanguard Holds Half of PG&E's $920 Million Municipal Bonds

The Vanguard Group holds about $415 million of municipal bonds issued on behalf of PG&E Corp., about half of the $920 million state and local debt sold for the California utility that’s edging toward bankruptcy because of the fallout form devastating wildfires.

But all but $2 million of the bonds held by Vanguard are backed by banks that act as buyers of last resort for the securities, insulating the money manager from risk, said Freddy Martino, a spokesman. Martino declined to comment on PG&E’s impending bankruptcy, though he said the firm’s holdings have declined about $15 million since its filings at the end of December.

Vanguard held $227.9 million of PG&E debt in its $5.6 billion California Municipal Money Market fund as of Dec. 31, according to data compiled by Bloomberg. It held another $110 million of PG&E’s debt in its California intermediate and long-term funds and $94.5 million in its $18.3 billion national money market fund.