Fitch Affirms VMTP Shares Issued by 9 Invesco Closed-End Funds at 'AAA'

NEW YORK--()--Fitch Ratings has affirmed the 'AAA' ratings on almost $2 billion of Variable Rate Muni Term Preferred Shares (VMTP Shares) issued by nine municipal closed-end funds managed by Invesco Advisers, Inc. (NYSE:IVZ, Invesco). A complete list of the funds and the associated VMTP Shares is provided at the end of this release.

KEY RATING DRIVERS

The 'AAA' long-term ratings primarily reflect:

--Sufficient asset coverage provided to the preferred shares as calculated per the funds' overcollateralization (OC) tests;

--The structural protections afforded by mandatory de-leveraging provisions in the event of asset coverage declines;

--The legal and regulatory parameters that govern the funds' operations;

--The capabilities of Invesco as investment advisor.

LEVERAGE

As of March 31, 2015, effective leverage ratios for the funds ranged from 31% to 41%. The funds generally leverage with both tender option bonds (TOBs) and Fitch-rated VMTPs.

ASSET COVERAGE

As of March 31, 2015, each fund's asset coverage ratio for the preferred shares, as calculated in accordance with the 'AAA' Fitch total and net overcollateralization tests (Fitch OC Tests) outlined in Fitch's criteria, was in excess of 100%. This is the minimum threshold required under the terms of the preferred shares.

As of the same date, the funds' asset coverage ratios for total outstanding preferred shares, as calculated in accordance with the Investment Company Act of 1940, was in excess of the minimum asset coverage of 225% required by the funds' governing documents (Preferred Shares Asset Coverage Test).

The funds' effective leverage ratios were below the 45% maximum leverage ratio allowed by the funds' governing documents for the VMTP shares. In the event of breaches to any of the above thresholds, the funds are required to restore compliance per structural protections described below.

STRUCTURAL PROTECTIONS

Compliance with the Fitch OC, Asset Coverage and Effective Leverage thresholds is tested periodically. The fund manager is expected to cure any breach by altering the composition of the portfolio toward assets with lower discount factors (for Fitch OC breaches), or by reducing leverage in a sufficient amount (for all other breaches) within a pre-specified time period.

For Fitch OC tests and Asset Coverage tests, the total market value exposure (i.e. valuation, cure and redemption) is approximately 45 business days. For Effective Leverage tests, the exposure period is approximately 10 business days.

FUND PROFILES

The funds are closed-end management investment companies regulated by the Investment Company Act of 1940. The funds invest primarily in municipal securities that are rated investment grade by at least one nationally recognized statistical rating organization and that are exempt from federal taxes.

Municipal obligations include municipal bonds, municipal notes, municipal commercial paper and lease obligations. The funds may also may invest up to 20% of its net assets in non-investment-grade and unrated securities that are determined to be of comparable quality.

THE ADVISER

Invesco Advisers, Inc., an indirect, wholly owned subsidiary of Invesco Ltd., is the funds' adviser, responsible for the funds' overall investment strategies and their implementation. Invesco Ltd. Had approximately $798.3 billion of assets under management as of March 31, 2015.

RATING SENSITIVITIES

The ratings assigned to the preferred shares may be sensitive to material changes in the leverage composition, portfolio credit quality or market risk of the funds, as described above. A material adverse deviation from Fitch guidelines for any key rating driver could cause ratings to be lowered by Fitch. The funds have the ability to assume economic leverage through derivative transactions which may not be captured by the funds' Preferred Shares Asset Coverage test or Effective Leverage Ratio.

The funds currently do not engage in derivative activities for speculative purposes and do not envision engaging in such activity in the future. Material derivative exposure in the future could have potential negative rating implications if it adversely affects asset coverage available to rated preferred shares.

Fitch has affirmed the following ratings:

--Invesco Advantage Municipal Income Trust II (VKI)
$231,000,000 of VMTP Shares at 'AAA';

--Invesco California Value Municipal Income Trust (VCV)
$188,300,000 of VMTP Shares at 'AAA';

--Invesco Municipal Opportunity Trust (VMO)
$367,600,000 of VMTP Shares at 'AAA';

--Invesco Municipal Trust (VKQ)
$262,800,000 of VMTP Shares at 'AAA';

--Invesco Pennsylvania Value Municipal Income Trust (VPV)
$130,100,000 of VMTP Shares at 'AAA';

--Invesco Quality Municipal Income Trust (IQI)
$213,900,000 of VMTP Shares at 'AAA';

--Invesco Trust for Investment Grade Municipals (VGM)
$273,300,000 of VMTP Shares at 'AAA';

--Invesco Trust for Investment Grade New York Municipals (VTN)
$90,400,000 of VMTP Shares at 'AAA';

--Invesco Value Municipal Income Trust (IIM)
$143,100,000 of VMTP Shares at 'AAA'.

For additional information about Fitch rating guidelines applicable to debt and preferred stock issued by closed-end funds, please review the criteria referenced below, which can be found on Fitch's web site at 'www.fitchratings.com'.

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

The sources of information used to assess this rating were the public domain and Invesco.

Opt-in to receive Fitch's forthcoming research on closed-end funds:

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

Applicable Criteria and Related Research:

--'Rating Closed-End Fund Debt and Preferred Stock' (September 2014);

Applicable Criteria and Related Research:

Rating Closed-End Fund Debt and Preferred Stock
http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=765528

Additional Disclosure

Solicitation Status
http://www.fitchratings.com/gws/en/disclosure/solicitation?pr_id=984071

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Contacts

Fitch Ratings
Primary Analyst
Russ Thomas, +1-312-368-3189
Director
Fitch Ratings, Inc.
70 West Madison Street
Chicago, IL 60602
or
Secondary Analyst
Ralph R. Aurora, +1-212-908-0528
Senior Director
or
Committee Chairperson
Ian Rasmussen, +1-212-908-0232
Senior Director
or
Media Relations, New York
Alyssa Castelli, +1-212-908-0540
alyssa.castelli@fitchratings.com
Elizabeth Fogerty, +1-212-908-0526
elizabeth.fogerty@fitchratings.com

Contacts

Fitch Ratings
Primary Analyst
Russ Thomas, +1-312-368-3189
Director
Fitch Ratings, Inc.
70 West Madison Street
Chicago, IL 60602
or
Secondary Analyst
Ralph R. Aurora, +1-212-908-0528
Senior Director
or
Committee Chairperson
Ian Rasmussen, +1-212-908-0232
Senior Director
or
Media Relations, New York
Alyssa Castelli, +1-212-908-0540
alyssa.castelli@fitchratings.com
Elizabeth Fogerty, +1-212-908-0526
elizabeth.fogerty@fitchratings.com