The ratings on Defence Housing Authority (DHA) reflect its tightly codified risk-sharing long-term agreement with its main customer (the Department of Defence) and its close relationship with its owner, the Commonwealth of Australia (local currency, AAA/Stable/A-1+; foreign currency, AA+/Stable/A-1+). A proposed capital restructure will weaken the existing very strong financial position, but is consistent with the rating. More than 90% of DHA's operating revenue comes from Defenceùa government department of the Commonwealth of Australiaùand so the credit quality of this revenue stream is very strong. Furthermore, the signing of an agreement with Defence that is in place until at least 2010 codifies the sharing of risks. As a result of the agreement, DHA bears a degree of market rental risk,
