New York, December 22, 2010 -- Moody's Investors Service has downgraded 16 confirmed 7 long-term
ratings for transactions supported by Branch Banking and Trust Company
letters of credit that utilize a joint default analysis ("JDA").
Please see list of affected transactions below.
RATINGS RATIONALE
The rating actions are in connection with the December 20, 2010
downgrade of the long-term Other Senior Obligations (OSO) rating
of Branch Banking and Trust Company to A1 from Aa3 (on watch for downgrade).
As a result of the rating action for Branch Banking and Trust Company,
Moody's has reviewed the ratings on jointly supported letter of credit
backed transactions supported by Branch Banking and Trust Company letters
of credit. The long-term JDA rating on these transactions
reflects Moody's approach to rating jointly supported transactions and
takes into account (i) the long-term rating of Branch Banking and
Trust Company (the Bank) as letter of credit provider, (ii) the
underlying rating assigned to the bonds, (iii) the structure and
legal protections of the transaction, which ensures timely debt
service payments to investors; and (iv) the default dependence between
the Bank and the borrower. The short-term rating of the
Bonds is based solely upon the short-term rating of Branch Banking
and Trust Company (P-1) as provider of the letters of credit.
The downgrades/confirmations do not affect the underlying ratings of the
affected transactions' obligors and they do not reflect the rating agency's
opinion of the obligors' credit quality or the default dependence between
Branch Banking and Trust Company and the applicable borrower.
Debt Affected and Rating Actions:
Albemarle County Economic Development Authority, VA, Variable
Rate Hospital Revenue Bonds (Martha Jefferson Hospital, VA) Series.
2008A; rating to Aa2 from Aa1 (on watch for possible downgrade);
Albemarle County Economic Dev. Authority, VA, Variable
Rate Hospital Revenue Bonds (Martha Jefferson Hospital, VA) Series
2008B; rating to Aa2 from Aa1 (on watch for possible downgrade);
Blount County Public Building Authority, TN Local Government Public
Improvement Bonds Series E-1-A; rating to Aa1 from
Aa1 (on watch for possible downgrade);
Blount County Public Building Authority, TN Local Government Public
Improvement Bonds Series E-5-A; rating to Aa1 from
Aa1 (on watch for possible downgrade);
Blount County Public Building Authority, TN Local Government Public
Improvement Bonds Series E-5-B; rating to Aa2 from
Aa3 (on watch for possible downgrade);
Blount County Public Building Authority, TN, Local Government
Public Improvement Bonds (Bradley (County of) TN) Series E-6-A;;
rating to Aa1 from Aa1 (on watch for possible downgrade);
Henderson (County of) KY, Variable Rate Demand Revenue Bonds (Murray-Calloway
Co. Pub. Hospital Corp., KY) Ser. 2002
A-1; rating to Aa2 from Aa1 (on watch for possible downgrade);
Indiana Finance Authority, Variable Rate Hosp Rev Bonds (Clarian
Health Partners, IN) Series 2008A; rating to Aa2 from Aa1 (on
watch for possible downgrade);
Indiana Health Facility Financing Authority, Revenue Bonds (Clarian
Health Partners, IN) Ser. 2005C; rating to Aa2 from
Aa1 (on watch for possible downgrade);
Indiana Health Facility Financing Authority, Revenue Bonds (Clarian
Health Partners, IN) Ser. 2005D; rating to Aa2 from
Aa1 (on watch for possible downgrade);
Kentucky Economic Development Finance Authority, Adjustable Rate
Revenue Bonds (King's Daughters' Medical Center, KY) Ser.
2008A; rating to Aa2 from Aa1 (on watch for possible downgrade);
Kentucky Economic Development Finance Authority, Adjustable Rate
Revenue Bonds (King's Daughters' Medical Center, KY) Series 2008
B; rating to Aa2 from Aa1 (on watch for possible downgrade);
Kentucky Economic Development Finance Auth., Variable Rate
Hospital Revenue Bonds (Baptist Healthcare System Obligated Group,
KY) Series 2009B-3; rating to Aa1 from Aa1 (on watch for possible
downgrade);
Kentucky Economic Development Finance Auth., Variable Rate
Hospital Revenue Bonds (Baptist Healthcare System Obligated Group,
KY) Series 2009B-4; rating to Aa1 from Aa1 (on watch for possible
downgrade);
Maryland Health & Higher Edl. Fac. Authority,
Revenue Bonds (Frederick Memorial Hospital, Inc., MD)
Series 2008; rating to Aa2 from Aa1 (on watch for possible downgrade);
Maryland Health & Higher Educational Facility Authority, Revenue
Bonds (Upper Chesapeake Hospital) Ser. 2008B; rating to Aa3
from Aa3 (on watch for possible downgrade);
North Carolina Medical Care Commission, Variable Rate Health Facility
Revenue Bonds (University Health Systems of E. Carolina,
NC) Series 2008B-1; rating to Aa2 from Aa1 (on watch for possible
downgrade);
North Carolina Medical Care Commission, Variable Rate Health Facility
Revenue Bonds (University Health Systems of E. Carolina,
NC) Series 2008B-2; rating to Aa2 from Aa1 (on watch for possible
downgrade);
North Carolina Medical Care Commission, Variable Rate Health Facility
Rev Bonds (Cumberland County Hospital System, Inc.,
NC) Ser. 2008A-1; rating to Aa2 from Aa1 (on watch
for possible downgrade);
North Carolina Medical Care Commission, Variable Rate Health Facility
Revenue Bonds (Cumberland County Hospital System, Inc.,
NC) Series 2008A-2; rating to Aa2 from Aa1 (on watch for possible
downgrade);
Orange County Health Facilities Authority, FL, Variable Rate
Hospital Revenue Bonds (Orlando Regional Healthcare System, FL)
Ser. 2008E; rating to Aa2 from Aa1 (on watch for possible
downgrade);
Oxford (City of) AL General Obligation Notes Ser. 2003; rating
to Aa1 from Aa1 (on watch for possible downgrade);
West Virginia Hospital Finance Authority, Variable Rate Revenue
Bonds (Charleston Area Medical Center) Ser. 2008A; rating
to Aa2 from Aa1 (on watch for possible downgrade);
What Could Change the Rating-Up
Long-term: The long-term rating on the bonds could
be raised if the long term OSO rating on the Bank or the long-term
rating of the underlying bonds was upgraded or there was a decrease in
the default dependence between the applicable borrower and Bank.
Short-term: N/A
What Could Change the Rating-Down
Long-Term: The long-term rating on the bonds could
be lowered if the long term OSO rating on Branch Banking and Trust Company
or the long-term rating of the underlying bonds was downgraded
or there was in increase in the default dependence between the applicable
borrower and Bank..
Short-term: The short-term rating on the bonds could
be lowered if the short-term OSO rating on the Bank was downgraded.
Please see ratings tab on the issuer/entity page on Moodys.com
for the last rating action and the rating history.
Methodology
The principal methodologies used in rating this issue was Moody's Rating
methodology for Letter of Credit Supported Transactions were published
in August 2005 and Applying Global Joint Default Analysis to Letter of
Credit Backed Transactions in the U.S. Public Finance Sector
published on October 2010.
REGULATORY DISCLOSURES
Information sources used to prepare the credit rating are the following:
parties involved in the ratings and public information.
Moody's Investors Service considers the quality of information available
on the issuer or obligation satisfactory for the purposes of maintaining
a credit rating.
Moody's adopts all necessary measures so that the information it uses
in assigning a credit rating is of sufficient quality and from sources
Moody's considers to be reliable including, when appropriate,
independent third-party sources. However, Moody's
is not an auditor and cannot in every instance independently verify or
validate information received in the rating process.
Please see ratings tab on the issuer/entity page on Moodys.com
for the last rating action and the rating history.
The date on which some Credit Ratings were first released goes back to
a time before Moody's Investors Service's Credit Ratings were fully digitized
and accurate data may not be available. Consequently, Moody's
Investors Service provides a date that it believes is the most reliable
and accurate based on the information that is available to it.
Please see the ratings disclosure page on our website www.moodys.com
for further information.
Please see the Credit Policy page on Moodys.com for the methodologies
used in determining ratings, further information on the meaning
of each rating category and the definition of default and recovery.
New York
Robert Azrin
Vice President - Senior Analyst
Public Finance Group
Moody's Investors Service
JOURNALISTS: 212-553-0376
SUBSCRIBERS: 212-553-1653
New York
Michael J. Loughlin
Vice President - Senior Analyst
Public Finance Group
Moody's Investors Service
JOURNALISTS: 212-553-0376
SUBSCRIBERS: 212-553-1653
Moody's Investors Service
250 Greenwich Street
New York, NY 10007
U.S.A.
JOURNALISTS: 212-553-0376
SUBSCRIBERS: 212-553-1653
Moody's downgrades 16 and confirms 7 long-term ratings on transactions supported by Branch Banking and Trust Company LOCs : Rating changes affect 15 distinct obligors in various municipal sectors