Fitch Affirms Cleco Katrina/Rita Hurricane Recovery Funding Storm Recovery Bonds 2008-A
OREANDA-NEWS. Fitch Ratings has affirmed two outstanding classes of the Cleco Katrina/Rita Hurricane Recovery Funding Storm Recovery Bonds 2008-A at 'AAAsf.' A full list of rating actions follows at the end of this press release.
KEY RATING DRIVERS
The transaction is performing within expectations, with levels of outstanding principal amounts in-line with the targeted amortization schedules. The true-up mechanism is performing as expected, providing adequate credit support for all outstanding classes.
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'.
DUE DILIGENCE USAGE
No third party due diligence was provided or reviewed in relation to this rating action.
Fitch has affirmed the following ratings:
--Class A-1 notes at 'AAAsf'; Outlook Stable;
--Class A-2 notes at 'AAAsf'; Outlook Stable.