Bangkok--4 Sep--Standard & Poor's
Standard & Poor's Ratings Services has raised the rating on the Colorado Housing and Finance Authority's class I adjustable-rate single-family mortgage bonds series 2005 B-2 to 'AAA/A-1+' from 'AAA/A-1', following the substitution of a standby bond purchase agreement (SBPA) from Barclays Bank PLC ('A-1+' short-term) for one from Dexia Credit Local ('A-1' short-term) on Sept. 2, 2009. The SPBA will cover 100% of principal and interest for 184 days. The outlook is stable.
"The stable outlook on the class I bonds reflects our opinion of the extremely high asset-to-liability coverage that is in excess of our loss coverage requirements, extremely strong asset quality, and management's strong oversight of the program," said Standard & Poor's credit analyst Lawrence Witte. "We could lower the ratings if parity levels on the class I bonds deteriorate to less than our loss coverage requirements."
The SBPA expires on Sept. 1, 2010, unless terminated earlier in accordance with its terms. One automatic termination event without notice is the lowering of the long-term rating on the bonds, currently 'AAA', to less than 'BBB-'. Should such an event occur, the bondholders' option to tender their bonds would not terminate, but the obligor would not be obligated to purchase the bonds.
Should any of the bonds that the bank purchases fail to be remarketed, payment to the bank will be the issuer's obligation on the 60th day following their purchase. The bonds shall bear interest at the highest of 12%, 150% of LIBOR, or 150% of the yield on actively traded 30-year U.S. Treasury Bonds.
RELATED RESEARCH
USPF Criteria: "Bank Liquidity Facilities," June 22, 2007
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Media Contact:
Ana Sandoval, New York (1) 212-438-5095, [email protected]
Analyst Contacts:
Lawrence Witte, San Francisco (1) 415-371-5037
Karen Fitzgerald, San Francisco (1) 415-371-5023
Key Contacts:
Americas Media Relations: (1) 212-438-6667
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Americas Customer Service: (1) 212-438-7280
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