Fitch Affirms 2 U.S. Utility Tariff Bond Transactions

NEW YORK--(BUSINESS WIRE)--Fitch Ratings affirms the 'AAA' ratings and Stable Outlooks on two U.S. utility tariff bond transactions as follows:

CenterPoint Energy Transition Bond Company IV, LLC

--Class A-1 at 'AAAsf'; Outlook Stable;

--Class A-2 at 'AAAsf'; Outlook Stable;

--Class A-3 at 'AAAsf'; Outlook Stable.

Utility Debt Securitization Authority Restructuring Bonds Series 2013T and Series 2013TE

Series 2013T

--T-1 bonds at 'AAAsf'; Outlook Stable;

--T-2 bonds at 'AAAsf'; Outlook Stable;

--T-3 bonds at 'AAAsf'; Outlook Stable;

--T-4 bonds at 'AAAsf'; Outlook Stable.

Series 2013TE

--TE-1 bonds at 'AAAsf'; Outlook Stable;

--TE-2 bonds at 'AAAsf'; Outlook Stable;

--TE-3 bonds at 'AAAsf'; Outlook Stable;

--TE-4 bonds at 'AAAsf'; Outlook Stable;

--TE-5 bonds at 'AAAsf'; Outlook Stable;

--TE-6 bonds at 'AAAsf'; Outlook Stable;

--TE-7 bonds at 'AAAsf'; Outlook Stable;

--TE-8 bonds at 'AAAsf'; Outlook Stable;

--TE-9 bonds at 'AAAsf'; Outlook Stable;

--TE-10 bonds at 'AAAsf'; Outlook Stable;

--TE-11 bonds at 'AAAsf'; Outlook Stable;

--TE-12 bonds at 'AAAsf'; Outlook Stable;

--TE-13 bonds at 'AAAsf'; Outlook Stable;

--TE-14 bonds at 'AAAsf'; Outlook Stable;

--TE-15 bonds at 'AAAsf'; Outlook Stable;

--TE-16 bonds at 'AAAsf'; Outlook Stable;

--TE-17 bonds at 'AAAsf'; Outlook Stable.

KEY RATING DRIVERS

The CenterPoint Energy Transition Bond Company IV, LLC transaction is performing within expectations, with levels of outstanding principal amounts in-line with their targeted amortization schedules. The true-up mechanism is performing as expected, providing adequate credit support for all outstanding classes.

While the Utility Debt Securitization Authority Restructuring Bonds series 2013T and series 2013TE transaction has yet to experience its first distribution period (Dec. 15, 2014), total collections have tracked within 0.2% of projected collections. Given this immaterial variance, Fitch expects the transaction to perform within expectations.

RATING SENSITIVITIES

As part of Fitch's initial rating sensitivity, Fitch conducted a break the bond case which provides an alternative means by which to measure the potential effects of rapid, significant declines in power consumption while capping the residential securitization charges at 20% of the total customer bill. This analysis determines the maximum level of forecasted energy decline that would cause a default in required payments on the securitizations or cause the tariff charges to exceed 20% of the total residual customer bill. Despite this severe decline in consumption, due to the true-up mechanisms, the tariff charges are able to pay all debt service by the legal final maturity date.

For further detail on the rating sensitivity analysis for Utility Tariff Bonds, please refer to Fitch's criteria titled 'Rating Criteria for U.S. Utility Tariff Bonds' available at 'www.fitchratings.com'.

Individual Representations, Warranties, and Enforcement Mechanisms reports are available for all structured finance transactions initially rated on or after Sept. 26, 2011 at 'www.fitchratings.com'.

Additional information is available at 'www.fitchratings.com'.

Applicable Criteria and Related Research:

--'Global Structured Finance Rating Criteria' August 2014;

--'Representations, Warranties, and Enforcement Mechanisms in Global Structured Finance Transactions' April 17, 2012;

--'CenterPoint Energy Transition Bond Company IV, LLC 2012 Senior Secured Transition Bonds (US ABS)' Jan 2012;

--'CenterPoint Energy Transition Bond Company IV, LLC 2012 Senior Secured Transition Bonds - Appendix' Jan 2012;

--'Utility Debt Securitization Authority Restructuring Bonds Series 2013T and Series 2013TE - Appendix' Dec 2013;

--'Utility Debt Securitization Authority Restructuring Bonds Series 2013T and Series 2013TE (US ABS)' Dec 2013;

--'Rating Criteria for U.S. Utility Tariff Bonds' Dec. 18, 2013.

Applicable Criteria and Related Research:

Global Structured Finance Rating Criteria

http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=754389

Representations, Warranties and Enforcement Mechanisms in Global Structured Finance Transactions

http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=799248

CenterPoint Energy Transition Bond Company IV, LLC 2012 Senior Secured Transition Bonds (US ABS)

http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=665650

CenterPoint Energy Transition Bond Company IV, LLC 2012 Senior Secured Transition Bonds -- Appendix

http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=665756

Additional Disclosure

Solicitation Status

http://www.fitchratings.com/gws/en/disclosure/solicitation?pr_id=935255

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