NEW YORK--(Business Wire)--Fitch Ratings stated on Dec. 19, 2007 that in determining the
rating of an insured bond, Fitch would apply the higher of the
financial guarantor's Insurer Financial Strength (IFS) rating or the
insured bond's underlying rating. Fitch also indicated that if Fitch
did not maintain an underlying rating on the insured bond, the bond
would be rated at the insurer's IFS rating.
Subsequently, Fitch has determined that this policy may result in
ratings that are too low for insured bonds that have high underlying
ratings from one or more other rating agencies, but do not have
underlying ratings from Fitch. As a result, Fitch is adjusting its
policy. In the event Fitch downgrades a financial guarantor, Fitch
will implement its previously stated policy of adjusting ratings on
bonds insured by that guarantor to the higher of the Fitch IFS rating
on the guarantor or Fitch's underlying bond ratings, and in cases
where Fitch does not have underlying ratings, to the financial
guarantor's IFS rating. The change in Fitch's policy is that Fitch
will withdraw its ratings for those insured bonds that do not have
Fitch underlying ratings, but do have public underlying ratings from
Moody's and/or S&P that are higher than the financial guarantor's
Fitch IFS rating. If both Moody's and S&P have public underlying
ratings, Fitch will use the lower of the two in making this
determination
Fitch's rating definitions and the terms of use of such ratings
are available on the agency's public site, 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 Ratings
David Litvack, +1-212-908-0593 (New York)
Richard Hunter, +44-20-7417-4362 (London)
Media Relations:
Kenneth Reed, +1-212-908-0540 (New York)
Cindy Stoller, +1-212-908-0526 (New York)
Copyright Business Wire 2008
