Fitch Rates Rutgers State University, NJ GO CP Notes 'F1+'
NEW YORK--(BUSINESS WIRE)-- Fitch Ratings has assigned a rating of 'F1+' to Rutgers State University (NJ) general obligation commercial paper series A (tax-exempt); series B (tax-exempt); series C (federally taxable) and series D (extendable tax-exempt) (the notes).
KEY RATING DRIVERS
The 'F1+' rating is based on the liquidity support provided by Wells Fargo Bank, National Association(Wells; rated 'AA/F1+', Stable Outlook) in the form of a Standby Commercial Paper Purchase Agreement (SCPPA) which has a stated expiration date of April 10, 2018 unless extended or earlier terminated and Rutgers University. The Wells SCPPA provides coverage for the principal amount of the notes due on the maturity dates of the notes. Rutgers University remains obligated to pay interest upon maturity of all notes. Fitch currently rates general obligations of Rutgers State University 'AA-', Stable Outlook (see rating action commentary dated July 29, 2015, available at 'www.fitchratings.com').
U.S. Bank National Association as the Issuing and Paying Agent (IPA) for the notes will draw on the SCPPA whenever proceeds of the sale of rollover notes and University revenues are insufficient to pay maturing notes. The SCPPA provides sufficient coverage for the $200,000,000 principal amount of notes.
The notes were issued at par, with interest due at maturity. Following the occurrence of an event of default under the SCPPA, Wells may direct the IPA to immediately stop the issuance of any additional notes (a no-issuance instruction). Following the no-issuance instruction the bank may reduce the stated amount of the SCPPA to the amount of notes outstanding. The IPA may submit a request for purchase to pre-fund the purchase of commercial paper notes outstanding. In addition, the SCPPA may be terminated at Wells Fargo's option upon the occurrence of specified termination events. The dealers for the notes are Morgan Stanley and Bank of America Merrill Lynch.
RATING SENSITIVITIES
The 'F1+' rating reflects the short-term rating that Fitch maintains on the bank providing liquidity support and will be adjusted upward or downward in conjunction with changes to the short-term rating of the bank and in some cases, the long-term rating of Rutgers University.
Additional information is available at www.fitchratings.com.
Applicable Criteria
Rating Criteria for Variable-Rate Demand Obligations and Commercial Paper Issued with External Liquidity Support (pub. 28 Jan 2016)
https://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=876837
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=999306
Solicitation Status
https://www.fitchratings.com/gws/en/disclosure/solicitation?pr_id=999306
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.
View source version on businesswire.com: http://www.businesswire.com/news/home/20160210005991/en/
Fitch Ratings
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Linda Friedman
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Director
+1-212-908-0689
Fitch Ratings, Inc.
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Street
New York, NY 10004
or
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Richard
Park
Director
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or
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Mario Civico
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Media
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Source: Fitch Ratings
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