Approximately $323 million in debt affected
New York, June 25, 2012 -- Moody's places 36 Aaa and Aaa(sf)-rated local housing finance
fixed-rate bond issues under review for possible downgrade following
the downgrades of Natixis, Credit Agricole, and Societe Generale
to A2/P-1. All of the bond issues are supported by guaranteed
investment contracts (GIC's) from the banks, and may be subject
to: (i) increased principal repayment risk as a result of the reduced
credit quality of the providers and (ii) the risk that, in the event
the GIC is replaced, the new interest rate from the replacement
investment will not be high enough to support debt service on the bonds.
The following listed bond issues are either single family or multifamily
bonds backed by mortgage backed securities (MBS). The bond issues
have further support in the form of guaranteed investment contracts (GIC's).
The investment contracts guarantee a fixed rate of return on mortgage
revenues received by the trustee and deposited with the bank. The
revenues are paid out every six months, as principal and interest
on the bonds. During the six month period the revenues are held
as deposits with the bank. This exposes the deposits to bankruptcy
risks. Should the bank go into bankruptcy the deposits may be lost
forever which could then, in turn, cause a default on the
scheduled payments to bond holders.
1 City of Chicago, Collateralized Single Family Mortgage Revenue
Bonds, Series 2007 C
2 City of Chicago, Collateralized Single Family Mortgage Revenue
Bonds, Series 2007-2A
3 City of Chicago, Collateralized Single Family Mortgage Revenue
Bonds, Series 2007-2C
4 City of Chicago, Collateralized Single Family Mortgage Revenue
Bonds, Series 2007-2K
5 Clay County Housing Finance Authority, FL, Single Family
Mortgage Revenue Bonds (Multi-County Program), 2007 A-1
& A-2
6 Housing Finance Authority of Broward County, Florida, Single
Family Mortgage Revenue Bonds, Series 2007E
7 Jefferson Parish Finance Authority, LA, Single Family Mortgage
Revenue Bonds 2006D
8 Lee County Housing Finance Authority, FL, Single Family
Mortgage Revenue Bonds, 2007 A, B & C
9 Pima Co. & Maricopa Co. Ind. Devel.
Auth. Multi-family hsg. Revenue ser. '93A
(RTC Bulk Sale Prog.) (FNMA coll.)
10 Sedgwick & Shawnee (Counties of), KS, Single Family
Mortgage Revenue Bonds (Mortgage-Backed Securities Program) 2007
A-3
11 Sedgwick County Kansas, Shawnee County Kansas, and Reno
County Kansas, GNMA Collateralized Single Family Mortgage Revenue
Bonds, Series 1995A
12 Sedgwick County, Kansas and Shawnee County, Kansas,
Single Family Mortgage Revenue Bonds (Mortgage-Backed Securities
Program) Series 2006 B-5
13 Texas Dept. of Housing & Community Affairs, Multifamily
Housing Revenue Bonds (GNMA Collateralized Mortgage Loan - Villas
at Mesquite Creek Project), 2007 A&B
14 Tucson & Pima County Ind. Dev. Auth.,
AZ, Joint Single Family Mortgage Revenue Bonds, 2007 B
15 Chicago (City of) IL, Collateralized Single Family Mortgage Revenue
Bonds, 2006 G&H
16 Chicago (City of) IL, Collateralized Single Family Mortgage Revenue
Bonds, 2006 I & J
17 Chicago (City of) IL, Collateralized Single Family Mortgage Revenue
Bonds, Series 2006C&D
18 Chicago (City of) IL, Housing Revenue Refunding Bonds,
2006K
19 City of Chicago, Collateralized Single Family Mortgage Revenue
Bonds, Series 2007 A
20 City of Chicago, Collateralized Single Family Mortgage Revenue
Bonds, Series 2007 E
21 City of Chicago, Collateralized Single Family Mortgage Revenue
Bonds, Series 2007 G
22 City of Chicago, Collateralized Single Family Mortgage Revenue
Bonds, Series 2007-2G
23 City of Chicago, Collateralized Single Family Mortgage Revenue
Bonds, Series 2007-2I
24 Cuyahoga (County of) OH Multifamily Housing Revenue Bonds (GNMA Collateralized
- Allerton Apartments Project) 2007A
25 Erie County Industrial Development Agency, NY, Multifamily
Housing Revenue Bonds (Sutton Place Apartments) Series 2003
26 Jefferson Parish Finance Authority, LA Single Family Mortgage
Revenue Refunding Bonds 2007C
27 Jefferson Parish Finance Authority, LA, Single Family Mortgage
Revenue Bonds 2007B
28 Jefferson Parish Finance Authority, LA, Single Family Mortgage
Revenue Refunding Bonds 2006B
29 San Diego Hsg Auth Multifam Hsg Rev Bonds (GNMA Coll Pres John Adams
Manor Apts) 1998 Issue B
30 Santa Clara Co Hsg Auth Multi-family Hsg Rev Ser '99A &
A-T (GNMA Collateralized-Don de Dios Apts)
31 Santa Clara Co Hsg Auth Multi-family Hsg Rev Ser '99B &
B-T (GNMA Collateralized-Village Avante Apts)
32 Summit County Port Authority, OH Multi-Family Revenue
Bonds (GNMA Collateralized - Callis Tower Project) 2007A
33 Dallas Housing Finance Corporation, Tx Multi-family Housing
Revenue Series '98 (Claremont Apts.)
34 Dallas Housing Finance Corporation, Tx Multi-family Housing
Revenue Series '98 (Towne Ctr. Aprt.)
35 D.C HFA - (BOWLING GREEN APTS PROJECT)Multi-Family
Housing Revenue Bonds (Bowling Green Apartments Project) GNMA Collateralized
Series 2003
36 Michigan State Housing Development Authority Limited Obligation Multifamily
Housing Revenue Bonds(GNMA Collateralized Program - Huntley Villas
Apartments), Series 2002A & B
Moody's will continue to monitor the bonds. We expect the
bond issuer to either keep the contract in place, which would cause
a downgrade of the bonds. Or, the contract will be terminated,
at which time Moody's would request new cashflows showing parity
sufficiency for the life of the bonds at an assumed 0% reinvestment
rate in order for the rating to be confirmed.
WHAT COULD MAKE THE RATING GO: UP
- Not Applicable
WHAT COULD MAKE THE RATING GO: DOWN OR BE WITHDRAWN
- Further downgrade of the GIC provider
- Drop in the asset to debt ratio
METHODOLOGIES USED
The principal methodologies used in this rating were Fixed Rate Multifamily
Housing Bonds Secured By Fannie Mae's Stand-By Credit Enhancement
Instrument(2006-11-20), GNMA Collateralized Multifamily
Housing Bonds(2001-06-01), and Strength in Structure:
Moody's Approach to Rating Single-Family Housing Bonds Secured
by Mortgage-Backed Securities(1998-10-08).
Please see the Credit Policy page on www.moodys.com for
a copy of these methodologies.
REGULATORY DISCLOSURES
The Global Scale Credit Ratings on this press release that are issued
by one of Moody's affiliates outside the EU are endorsed by Moody's
Investors Service Ltd., One Canada Square, Canary Wharf,
London E 14 5FA, UK, in accordance with Art.4 paragraph
3 of the Regulation (EC) No 1060/2009 on Credit Rating Agencies.
Further information on the EU endorsement status and on the Moody's
office that has issued a particular Credit Rating is available on www.moodys.com.
For ratings issued on a program, series or category/class of debt,
this announcement provides relevant regulatory disclosures in relation
to each rating of a subsequently issued bond or note of the same series
or category/class of debt or pursuant to a program for which the ratings
are derived exclusively from existing ratings in accordance with Moody's
rating practices. For ratings issued on a support provider,
this announcement provides relevant regulatory disclosures in relation
to the rating action on the support provider and in relation to each particular
rating action for securities that derive their credit ratings from the
support provider's credit rating. For provisional ratings,
this announcement provides relevant regulatory disclosures in relation
to the provisional rating assigned, and in relation to a definitive
rating that may be assigned subsequent to the final issuance of the debt,
in each case where the transaction structure and terms have not changed
prior to the assignment of the definitive rating in a manner that would
have affected the rating. For further information please see the
ratings tab on the issuer/entity page for the respective issuer on www.moodys.com.
Information sources used to prepare the rating are the following:
parties involved in the ratings and public information.
Moody's considers the quality of information available on the rated
entity, obligation or credit satisfactory for the purposes of issuing
a rating.
Moody's adopts all necessary measures so that the information it
uses in assigning a 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 Moody's Rating Symbols and Definitions on the Rating
Process page on www.moodys.com for further information on
the meaning of each rating category and the definition of default and
recovery.
Please see ratings tab on the issuer/entity page on www.moodys.com
for the last rating action and the rating history. The date on
which some ratings were first released goes back to a time before Moody's
ratings were fully digitized and accurate data may not be available.
Consequently, Moody's 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 www.moodys.com for any updates on changes to
the lead rating analyst and to the Moody's legal entity that has
issued the rating.
In addition to the information provided below please find on the ratings
tab of the issuer page at www.moodys.com, for each
of the ratings covered, Moody's disclosures on the lead rating
analyst and the Moody's legal entity that has issued each of the
ratings.
Richard Kubanik
Associate Analyst
Structured Finance Group
Moody's Investors Service, Inc.
250 Greenwich Street
New York, NY 10007
U.S.A.
JOURNALISTS: 212-553-0376
SUBSCRIBERS: 212-553-1653
Florence Zeman
Senior Managing Director
Public Finance Group
JOURNALISTS: 212-553-0376
SUBSCRIBERS: 212-553-1653
Releasing Office:
Moody's Investors Service, Inc.
250 Greenwich Street
New York, NY 10007
U.S.A.
JOURNALISTS: 212-553-0376
SUBSCRIBERS: 212-553-1653
Moody's places 36 Aaa and Aaa(sf)-rated local housing finance bond issues under review for possible downgrade following the downgrades of Natixis, Credit Agricole, and Societe Generale
