Fitch to Upgrade L-T to 'A+' & Confirm 'F1' on RI Hlth & Ed Bldg Corp Rev Rfgd Bds Ser 2008A

NEW YORK--(BUSINESS WIRE)--On the effective date of Dec. 4, 2012, Fitch Ratings will upgrade the long-term rating to 'A+', Stable Outlook from 'A', Stable Outlook and confirm the short-term rating of 'F1' assigned to the $61,930,000 Rhode Island Health and Educational Building Corporation higher education facility revenue refunding bonds, series 2008A (Rhode Island School of Design Issue), series 2008A. These rating actions are in connection with the substitution of the irrevocable direct-pay letter of credit (LOC) previously provided by Bank of America, N.A. (rated 'A/F1', Stable Outlook) with a substitute LOC issued by JPMorgan Chase Bank, N.A. (rated 'A+/F1', Stable Outlook). The long-term 'A+' rating is based on the higher of the underlying 'A+', Stable Outlook long-term rating that Fitch assigns to the bonds, and the support of the irrevocable direct-pay letter of credit (LOC) issued by JPMorgan Chase Bank, N.A. securing the bonds. The short-term 'F1' rating is based solely on the LOC supporting the bonds. For information about the underlying credit rating see the press release 'Fitch Rates Rhode Island School of Design Revenue Bonds 'A+'; Outlook Stable' dated June 14, 2012, available at 'www.fitchratings.com'.

Pursuant to the substitute LOC, the bank is obligated to make payments of principal of and interest on the bonds upon maturity, acceleration and redemption, as well as purchase price for tendered bonds. The rating will expire upon the earliest of: (a) Dec. 4, 2015, the initial stated expiration date of the substitute LOC, unless such date is extended; (b) conversion to the fixed interest rate mode; (c) any prior termination of the substitute LOC; and (d) defeasance of the bonds.

The JPMorgan Chase Bank, N.A substitute LOC provides full and sufficient coverage of principal plus an amount equal to 45 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 weekly and monthly interest rate modes. The remarketing agent for the bonds is Merrill Lynch, Pierce Fenner & Smith Incorporated.

Additional information is available at www.fitchratings.com.

Applicable Criteria and Related Research:

--'U.S. Municipal Structured Finance Criteria', Feb. 28, 2012;

--'Rating Guidelines for Letter of Credit-Supported Bonds', June 20, 2012

Applicable Criteria and Related Research:

U.S. Municipal Structured Finance Criteria

http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=672570

Rating Guidelines for Letter of Credit-Supported Bonds

http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=681737

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