New York City achieved a lower borrowing cost on yesterday's $703 million offering of fixed-rate general obligation bonds by making it easier for retail investors to participate directly in the deal, sources close to the deal said.

"One of our ideas when we initially made our presentation to the city was that the city should be able to take advantage of the fact that the mom-and-pop buyer is looking to buy bonds directly," said Paul Kuhns, a senior underwriter at Merrill Lynch & Co., which served as senior manager on the offering.

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