Bangkok--5 Aug--Standard & Poor's
Standard & Poor's Ratings Services lowered its rating on Bountiful, Utah's collateral mortgage revenue bonds series 98 to 'CC' from 'BBB' and removed the rating from CreditWatch with negative implications where it was placed July 1, 2009. The outlook is developing. This action follows Standard & Poor's July 28, 2009, downgrade of Ambac Assurance Corp. to CC/Developing from BBB/Watch Neg (see "Ambac Assurance Corp. Ratings Lowered To 'CC' From 'BBB'; Outlook Developing", RatingsDirect, July 28, 2009).
The affected issue receives partial support in the form of guaranteed investment contracts or investment agreements from Ambac Assurance Corp. for the debt service reserve fund (DSRF). According to current criteria, Standard & Poor's considers whether monies deposited in the DSRF, which is generally sized in the amount of at least six to 12 months' debt service, are invested in investment grade securities rated 'BBB-' or higher, and will be available to pay debt service in the event of a shortfall. Because AMBAC is currently rated below investment grade, its rating is no longer consistent with our minimum rating level for DSRF investments.
RELATED RESEARCH
USPF Criteria: "Review Of Investment Agreements For Municipal Revenue Bond Financings," June 26, 2007
Complete ratings information is available to RatingsDirect subscribers at www.ratingsdirect.com. All ratings affected by this rating action can be found on Standard & Poor's public Web site at www.standardandpoors.com; select your preferred country or region, then Ratings in the left navigation bar, followed by Find a Rating.
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