Armed with capital, new hires, Estrada Hinojosa expands muni underwriting

Estrada Hinojosa & Co., which was acquired by Texas Regional Bank in August, is expanding its municipal bond underwriting business in Texas and beyond as it adds to its ranks of professionals.

The acquisition brought a capital boost to Dallas-based Estrada Hinojosa, a full-service muni firm with a major financial advisory practice in the Southwest region, which now operates under TRB Capital Markets.

“Knowing people, people knowing you, knowing that [you are] delivering a good product — it’s a key to success,” Noe Hinojosa, the firm’s co-founder and president, said. “But today, capital, like always, continues to play a significant factor, especially under very unstable markets or uncertain markets.”

He added the firm wants to take advantage of a public finance boom in Texas, which for the first time since 1981 became the top volume state in 2023 with $59 billion of debt sold. The issuance of a record $67.88 billion of bonds in 2024 put the state in second place behind California.

“As issuers see our name out there, that we’re willing to put our capital commitment in play, they’re going to give us opportunities to be an underwriter more and more,” Hinojosa said. 

Since the acquisition was completed in August, the underwriting share of the firm’s business has risen to 38% from 25% historically, according to John Tippit, president of TRB Divisions, who said it marks a “significant uptick right out the gate.”

“Our goal is to initially build the premier municipal division in the state of Texas with relationships at the forefront,” he said.

Municipal bond market professionals have been hired, with more expected to be added this year, including for offices outside of Texas as part of a strategic plan to enhance the firm’s underwriting footprint along with a trading operation to help support negotiated and competitive underwriting, according to Tippit. 

“With the disruption in the space, with Citi exiting the municipal space in total, and then some other bigger firms getting kicked out of the state of Texas, … it’s led to some pretty interesting conversations with high-quality talent across the nation,” Tippit said.

Using anti-environmental, social, and governance laws enacted in 2021, Texas banned Citigroup, UBS, and Barclays from underwriting state and local government bonds after they were found to be “boycotting” or “discriminating” against the fossil fuel or firearm industries.

After leaving the Net-Zero Banking Alliance, several banks were released from a Texas Attorney General review that could have led to a ban, although Bank of America and JPMorgan are still under review for their firearm policies.

Estrada Hinojosa has attracted municipal market veterans Devin Phillips, a former UBS executive director and Citigroup capital markets director, who is heading up municipal underwriting, and Barbara Smallwood, a former Citigroup institutional sales manager, who is a senior managing director.

This month brought the addition of Bryan McCoy as co-head of municipal underwriting and Rena Connor as institutional sales manager.

McCoy, who previously led Mesirow Financial’s municipal bond department and served on the capital markets board, has more than three decades of experience in municipal bond sales, trading and underwriting, according to a TRB statement.

Connor most recently was a managing director at HilltopSecurities, where she “specialized in institutional sales and cultivated a reputation for driving revenue growth and delivering exceptional client service,” the statement said. 

After its acquisition, Estrada Hinojosa lost its minority-owned status, which some issuers consider through set asides or goals when parceling out municipal bond business. 

The status provided opportunity, particularly when the firm was launched, but later became confining, according to Hinojosa.

“One of the things that we experienced was the fact that we could not be given the opportunity to be a leader in the municipal advisory space,” he said. “It would always be that minority provider.”

A bill filed for the Texas Legislature’s 2025 session would replace references to minority- and woman-owned businesses with “economically disadvantaged businesses” — particularly those owned by veterans or historically underutilized businesses — for preferential treatment or for programs to increase participation in government contracts.

Hinojosa said the firm is exploring other services including private placements and liquidity support such as letters of credit. 

Estrada Hinojosa is a major financial advisor in the Southwest region, ranking second in 2023, according to LSEG data. In 2024, the firm ranked second in Texas. It was founded in 1992 by former bond attorney Robert Estrada and investment banker Hinojosa. It has offices in major Texas cities, as well as Chicago, New York, Miami, and Denver.