Summary: New York City; General Obligation; Joint Criteria

Standard&Poor's Ratings Services assigned its 'AAA/A-1' rating to New York City's general obligation (GO) bonds fiscal 2015 subseries F-4 and its 'AAA/A-1+' rating to New York City's GO bonds fiscal 2015 subseries F-7 based on the application of joint criteria (assuming low correlation). In addition, Standard&Poor's assigned its 'AA' underlying rating (SPUR) to each subseries F-4 and F-7. The long-term component of the rating is jointly (assuming low correlation) supported by the GO pledge of the New York City and the long-term ratings on the letter of credit (LOC) providers: The Bank of Tokyo-Mitsubishi UFJ, LTD. (A+/A-1) for subseries F-4, and Royal Bank of Canada (AA-/A-1+) for subseries F-7. The short-term components of the ratings are

...a draw on the respective LOC. Each SBPA and LOC is sized at principal plus 35 days of interest calculated at the maximum rate of 9% on the bonds. We believe each enhancer provides sufficient interest and principal while the bonds are in the covered rate modes, even assuming maximum interest rate accruals. Each of the subseries is expected to initially bear interest at a daily interest rate mode except subseries F-4 which is in a weekly interest rate mode. The SBPAs and the LOC for subseries F-7 enhance the respective bonds in the daily, weekly, and two-day rate modes. The LOC for subseries F-4 only covers bonds in the weekly rate mode. The bonds are subject to mandatory tender upon conversion to any other interest mode except between the daily, weekly, and two-day rate modes. However, we do not believe there is any mode conversion-related risk of an interest shortfall or put option loss to the subseries F-4 bondholders because the transaction documents require the issuer to provide a liquidity...

Summary