Fitch Rates $675.9MM FL's Hurricane Catastrophe Fund Finance Corp Revs 2010A 'AAApre' Outlook Stable

NEW YORK--()--Fitch Ratings assigns a rating of 'AAApre' to the $675,920,000 Florida Hurricane Catastrophe Fund (FHCF) Finance Corporation revenue bonds, series 2010A, refunded on July 11, 2014. The Rating Outlook is Stable.

KEY RATING DRIVERS:

The rating of 'AAApre', Stable Outlook is based on the pledge of securities in the escrow deposit fund securing the bonds and reflects the lien of the refunded bondholders on the escrow trust fund and that all amounts have been invested in: (1) direct non-callable obligations of the United States; and (2) non-callable senior obligations of Fannie Mae (FNMA) and the Federal Home Loan Bank. The U.S. full faith and credit is currently rated 'AAA', Stable Outlook by Fitch. As the rating of FNMA is currently linked to the U.S. sovereign rating, any rating action on the U.S. sovereign rating will directly affect the rating on the bonds with escrow funds invested in those securities. Should Fitch's view of the strength of government support for FNMA be reduced or downgraded, the rating of FNMA may be delinked from the U.S. sovereign rating and may result in negative pressure on the rating of the bond series supported by those securities.

The series 2010A bonds were refunded with the remaining series 2010A bond proceeds and the series 2010A debt service reserve fund, as well as excess emergency assessment revenues of the FHCF. The ratings apply to the bonds listed by CUSIP numbers, below.

Pursuant to an irrevocable escrow agreement, the escrow agent, Wells Fargo Bank, N.A., holds a separate special irrevocable escrow deposit trust fund for the benefit of the series 2010A refunded bondholders. All cash and securities held in the fund are pledged irrevocably to the payment when due of interest on the refunded bonds and the payment of principal upon maturity. In the future, any substitute or additional investments must be limited to direct non-callable obligations of the United States, non-callable and non-prepayable obligations unconditionally guaranteed by the United States, and certain prerefunded municipal bonds. The refunded series 2010A bonds will be redeemed at maturity on July 1, 2015 and July 1, 2016 at par plus accrued interest.

Causey Demgen & Moore P.C. verified the mathematical accuracy of computations relating to the adequacy of income from escrowed funds to pay debt service requirements of the refunded bonds. These computations were based on data provided to them by Raymond James & Associates, Inc., financial advisor for the refunded bonds. According to the Causey Demgen & Moore verification report, the securities and cash deposited will produce amounts necessary for timely payment of the principal and interest on the refunded bonds. Prior to accepting substitute or additional investment securities or disbursing funds, the escrow agent must receive a new report verifying the continued sufficiency of escrowed funds to meet all future payments of principal and interest on the refunded bonds.

RATING SENSITIVITIES:

The rating is currently exclusively tied to the U.S. sovereign creditworthiness and will reflect all changes to that rating. Should Fitch's view of the strength of government support for FNMA be reduced or downgraded, the rating of FNMA may be delinked from the U.S. sovereign rating and may result in negative pressure on the rating of the bond series supported by those securities.

The rating of 'AAApre' applies to the bonds with the following CUSIP numbers:

34074GDA9

34074GDC5

34074GDD3

34074GDB7

34074GDE1

Additional information is available at www.fitchratings.com.

Applicable Criteria and Related Research:

--'U.S. Municipal Structured Finance Criteria', Feb. 24, 2014;

--'Guidelines for Rating Prerefunded U.S. Municipal Bonds', Dec. 2, 2013.

Applicable Criteria and Related Research:

Guidelines for Rating Prerefunded U.S. Municipal Bonds

http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=724818

U.S. Municipal Structured Finance Criteria

http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=736618

Additional Disclosure

Solicitation Status

http://www.fitchratings.com/gws/en/disclosure/solicitation?pr_id=870354

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Contacts

Fitch Ratings
Primary Analyst
Kasia Reed, +1 212-908-0500
Analytical Consultant
Fitch Ratings, Inc.
33 Whitehall Street
New York, NY 10004
or
Secondary Analyst
Trudy Zibit, +1 212-908-0689
Managing Director
or
Committee Chairperson
Mario Civico, +1 212-908-0796
Senior Director
or
Media Relations, New York
Elizabeth Fogerty, +1 212-908-0526
elizabeth.fogerty@fitchratings.com

Contacts

Fitch Ratings
Primary Analyst
Kasia Reed, +1 212-908-0500
Analytical Consultant
Fitch Ratings, Inc.
33 Whitehall Street
New York, NY 10004
or
Secondary Analyst
Trudy Zibit, +1 212-908-0689
Managing Director
or
Committee Chairperson
Mario Civico, +1 212-908-0796
Senior Director
or
Media Relations, New York
Elizabeth Fogerty, +1 212-908-0526
elizabeth.fogerty@fitchratings.com