Standard&Poor's Ratings Services affirmed its 'AA' issuer credit rating on Michigan State Housing Development Authority (MSHDA), as well as its ratings on all debt supported by the authority's general obligation pledge and the moral obligation pledge of the state of Michigan. The affirmation reflects, in our opinion, the following credit strengths: Very strong trends in financial performance; The strong quality and performance of the authority's asset portfolios; A active management team; and The authority's success in meeting its legislative mandate and maintaining a strong and positive relationship with the state government. These strengths are offset, in our opinion, by the following weaknesses: Significant decline in profitability; Significant percentage of variable-rate debt exposure; and Moderate-to-high risk profile of the
