|[June 17, 2014]
Fitch to Confirm 'AA-/F1+' Rating on Community Hospital of the Monterey Peninsula, Ser 2011B
NEW YORK --(Business Wire)--
On the effective date of June 25, 2014, Fitch Ratings will confirm the
long and short-term ratings of 'AA-/F1+' assigned to the $55,000,000
California Statewide Development Authority health facility revenue bonds
(Community Hospital of the Monterey Peninsula), Series 2011B. The Rating
Outlook is Stable, for the long-term rating. The rating action is in
connection with the substitution of the irrevocable direct-pay letter of
credit (LOC) previously provided by U.S. Bank National Association
(rated 'AA-/F1+'; Stable Outlook) with a substitute LOC issued by Wells
Fargo Bank, National Association (rated 'AA-/F1+'; Stable Outlook) and
the mandatory tender of the bonds.
KEY RATING DRIVERS
The long-term 'AA-' rating will be based on the higher of the underlying
long-term rating assigned to the bonds by Fitch (currently rated 'AA-',
Stable Outlook), and the long-term rating assigned by Fitch to Wells
Fargo Bank, National Association (rated 'AA-/F1+'; Stable Outlook)), the
bank providing the irrevocable direct-pay letter of credit (LOC)
securing the bonds. The short-term 'F1+' rating is based solely on the
LOC. For information about the underlying credit rating see press
release 'Fitch Affirms Community Hospital of the Monterey Peninsula (CA (News - Alert))
Revs at 'AA-'; Outlook Stable', dated April 11, 2013 available at 'www.fitchratings.com'.
Pursuant to the substitute LOC, the bank is obligated to make regularly
scheduled payments of principal of and interest on the bonds in addition
to payments due upon maturity, acceleration and redemption, as well as
purchase price for tendered bonds. Additionally, the bond obligor is in
the flow of funds to make timely payments of principal and interest due
upon maturity, acceleration and redemption. The credit-enhanced ratings
will expire upon the earliest of: (a) June 24, 2019, the initial stated
expiration date of the substitute LOC, unless suchdate is extended; (b)
conversion to a commercial paper, indexed based or term interest rate
mode; (c) any prior termination of the substitute LOC; and (d)
defeasance of the bonds. The Wells Fargo (News - Alert) Bank, National Association
substitute LOC provides full and sufficient coverage of principal plus
an amount equal to 48 days of interest at a maximum rate of 12% based on
a year of 365 days and purchase price for tendered bonds, while in the
daily and weekly rate modes. The Remarketing Agent for the bonds will
continue to be Morgan Stanley & Co. LLC.
The long-term rating is tied to the Fitch long-term rating assigned to
the bonds and the long-term rating that Fitch maintains on the
substitute bank providing the LOC. Changes to one or both of these
ratings may affect the long-term rating assigned to the bonds.
The short-term rating is exclusively tied to the short-term rating that
Fitch maintains on the bank providing the substitute LOC and will
reflect all changes to that rating.
Additional information is available at www.fitchratings.com.
Applicable Criteria and Related Research:
--'U.S. Municipal Structured Finance Criteria' (Feb. 24, 2014);
--'Rating Guidelines for Letter of Credit-Supported Bonds and Commercial
Paper' (June 4, 2014).
Applicable Criteria and Related Research:
U.S. Municipal Structured Finance Criteria
Rating Guidelines for Letter of Credit-Supported Bonds and Commercial
ALL FITCH CREDIT RATINGS ARE SUBJECT TO CERTAIN LIMITATIONS AND
DISCLAIMERS. PLEASE READ THESE LIMITATIONS AND DISCLAIMERS BY FOLLOWING
THIS LINK: HTTP://FITCHRATINGS.COM/UNDERSTANDINGCREDITRATINGS.
AVAILABLE ON (News - Alert) THE AGENCY'S PUBLIC WEBSITE 'WWW.FITCHRATINGS.COM'.
PUBLISHED RATINGS, CRITERIA AND METHODOLOGIES ARE AVAILABLE FROM THIS
SITE AT ALL TIMES. FITCH'S CODE OF CONDUCT, CONFIDENTIALITY, CONFLICTS
OF INTEREST, AFFILIATE FIREWALL, COMPLIANCE AND OTHER RELEVANT POLICIES
AND PROCEDURES ARE ALSO AVAILABLE FROM THE 'CODE OF CONDUCT' SECTION OF
THIS SITE. FITCH MAY HAVE PROVIDED ANOTHER PERMISSIBLE SERVICE TO THE
RATED ENTITY OR ITS RELATED THIRD PARTIES. DETAILS OF THIS SERVICE FOR
RATINGS FOR WHICH THE LEAD ANALYST IS BASED IN AN EU-REGISTERED ENTITY
CAN BE FOUND ON THE ENTITY SUMMARY PAGE FOR THIS ISSUER ON THE FITCH
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