Fitch Updates U.S. Tobacco Settlement ABS Criteria for 'BB' Bonds

NEW YORK--()--Feb. 21, 2006--With the advent of new bond structures for tobacco settlement transactions, Fitch Ratings has reviewed and revised its methodology for determining 'BB' rated securities for U.S. tobacco settlement-backed bonds.

Under Fitch's revised tobacco settlement criteria, 'BB' rated securities may mature beyond the year 2046, so long as such bonds are able to pass a more stringent cash flow stress scenario. To be rated 'BB', the securities must either pass Fitch's current 'BB' stress and pay out by 2046 or withstand Fitch's 'BBB-' cash flow stress through out the rated term of the security.

Under Fitch's previous stress scenarios, all rated bonds needed to be paid in full by 2046. These revised assumptions are effective as of Feb. 21, 2006. This revision addresses the new bond structures and ensures cash flow assumptions are consistent with the ratings assigned throughout the term of the transactions. For more information, see 'Rating Tobacco Settlement Bonds: When the Smoke Clears' dated Jan. 23, 2005 and available on the Fitch Ratings web site at www.fitchratings.com.

Fitch's rating definitions and the terms of use of such ratings are available on the agency's public site, 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.

Contacts

Fitch Ratings
Jeffrey Prackup, 212-908-0839
Lena Katsnelson, 212-908-0876
Michael Dean, 212-908-0556
Sandro Scenga, 212-908-0278 (Media Relations)

Contacts

Fitch Ratings
Jeffrey Prackup, 212-908-0839
Lena Katsnelson, 212-908-0876
Michael Dean, 212-908-0556
Sandro Scenga, 212-908-0278 (Media Relations)