Fitch Rates Agency-Enhanced Affordable Housing Trust Class A Floating Certificates 2016-1 to 2016-52

NEW YORK--()--Fitch Ratings assigns a rating of 'AAA', Stable Outlook to the Agency-Enhanced Affordable Housing Trust Class A Floating Certificates Series 2016-1 through 2016-52.

KEY RATING DRIVERS

The Class A Floating Certificates relate to separate trusts into which custodial receipts will be deposited. The long-term 'AAA', Stable Outlook rating is based on the rating assigned by Fitch to the credit enhancement provided by Federal Home Loan Mortgage Corporation (Freddie Mac, rated 'AAA/F1+', Stable Outlook) securing the custodial receipts deposited in the trusts. As the ratings of Freddie Mac are currently linked to the U.S. sovereign rating, any rating action on the U.S. sovereign rating will directly affect the rating on the certificates. Should Fitch's view of the strength of government support for Freddie Mac be reduced or downgraded, the rating of Freddie Mac may be delinked from the U.S. sovereign rating and may result in negative pressure on the rating of the certificates.

The custodial receipts deposited in the Agency-Enhanced Affordable Housing Trusts (Custodial Asset) represent an ownership interest in assets deposited pursuant to a Custody Agreement with the Custodian, U.S. Bank National Association, and a right to receive payments of scheduled principal and interest pursuant to a Standby Credit Enhancement Agreement provided by Freddie Mac. In the event that on any bond interest payment date the Custodian receives an amount less than the amount of interest and/or principal then due on the Custodial Asset, then the amount of any such deficiency shall be made up from a demand, by the Custodian, on the Standby Credit Enhancement Agreement provided by Freddie Mac.

The Custodial Receipts are subject to mandatory tender on: (1) the earlier of the fifth business day prior to May 19, 2021, unless such date is extended, or the bond maturity date for the applicable series of Custodial Receipts (2) the fifth business day following receipt by the Custodian from Freddie Mac of an Event of Default by the Sponsor, TE Bond Subsidiary, LLC, under a reimbursement arrangement; (3) the fifth Business Day following receipt by the Custodian from Freddie Mac an Event of Default on the Custodial Asset; and (4) the fifth Business Day following receipt by the Custodian from Freddie Mac of the occurrence of certain events of default. The payment of the tender price for each mandatory tender shall be made from a demand, by the Custodian, on the Standby Credit Enhancement Agreement provided by Freddie Mac.

The credit enhancement is scheduled to expire upon the first to occur of (a) May 19, 2021, (b) the date the Custodial Receipts of the applicable series shall have been paid in full, (c) the effective date of any substitute credit enhancement, and (d) the date on which all of the bonds of the applicable series have been released or withdrawn from the Custody Agreement.

RATING SENSITIVITIES

The long-term rating assigned to the Class A Floating Certificates is tied to the long-term rating that Fitch maintains on Freddie Mac. As the ratings of Freddie Mac are currently linked to the U.S. sovereign rating, any rating action on the U.S. sovereign rating will directly affect the rating on the certificates. Should Fitch's view of the strength of government support for Freddie Mac be reduced or downgraded, the rating of Freddie Mac may be delinked from the U.S. sovereign rating and may result in negative pressure on the rating of the certificates.

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

Applicable Criteria

Criteria for Rating Tender Option Bonds (pub. 07 Apr 2016)
https://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=879516

U.S. Municipal Structured Finance Criteria (pub. 23 Feb 2015)
https://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=862222

Additional Disclosures

Dodd-Frank Rating Information Disclosure Form
https://www.fitchratings.com/creditdesk/press_releases/content/ridf_frame.cfm?pr_id=1004759

Solicitation Status
https://www.fitchratings.com/gws/en/disclosure/solicitation?pr_id=1004759

Endorsement Policy
https://www.fitchratings.com/jsp/creditdesk/PolicyRegulation.faces?context=2&detail=31

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. IN ADDITION, RATING DEFINITIONS AND THE TERMS OF USE OF SUCH RATINGS ARE AVAILABLE ON 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 WEBSITE.

Contacts

Fitch Ratings
Primary Analyst:
Richard Park, +1-212-908-0289
Director
Fitch Ratings, Inc.
33 Whitehall Street
New York, NY 10004
or
Secondary Analyst:
Mario Civico, +1-212-908-0796
Senior Director
or
Committee Chairperson:
Linda Friedman, +1-212-908-0727
Senior Director
or
Media Relations:
Elizabeth Fogerty, +1-212-908-0526
New York
elizabeth.fogerty@fitchratings.com

Contacts

Fitch Ratings
Primary Analyst:
Richard Park, +1-212-908-0289
Director
Fitch Ratings, Inc.
33 Whitehall Street
New York, NY 10004
or
Secondary Analyst:
Mario Civico, +1-212-908-0796
Senior Director
or
Committee Chairperson:
Linda Friedman, +1-212-908-0727
Senior Director
or
Media Relations:
Elizabeth Fogerty, +1-212-908-0526
New York
elizabeth.fogerty@fitchratings.com