Moody's maintains tobacco revenue bonds under review direction uncertain

New York, August 15, 2013 -- Moody's announced today that it will continue maintaining the ratings on the term bonds issued in tobacco settlement revenue securitizations under review with direction uncertain. Since Moody's placed the bonds under review in January 2013, it has corrected certain errors in the cash flow models used in rating such bonds. The corrections have a positive credit effect for most rated tranches. However, the bonds will remain under review because the positive credit effect of the model corrections is likely to be fully or partly offset by the negative effect of the recent settlement of the 10-year old NPM adjustment dispute between 22 states and tobacco manufacturers. The settlement agreement also indirectly impacts the securitizations sponsored by the states that chose not to settle by setting up a precedent that the recovery of the escrowed funds can be less than 100%.

Vollständigen Artikel bei Moodys lesen