OREANDA-NEWS. Fitch Ratings assigns an 'F1' short-term rating to the Idaho Housing and Finance Association single family mortgage class I bonds (2003 Indenture), $30,355,000 2016 series A-3, and class II bonds (2003 Indenture), $21,565,000 2016 series A-4.

KEY RATING DRIVERS

The short-term 'F1' ratings are based on the liquidity support provided by Barclays Bank PLC (rated 'A/F1', Stable Outlook) in the form of two Standby Bond Purchase Agreements (SBPAs). For information on the long-term ratings, see the press release dated June 22, 2016 titled 'Fitch Rates Idaho HFA's Class I and Class II Hsg Bonds 2016 Series A 'AAA' & 'AA'; Outlook Stable' available on Fitch's website at www. fitchratings. com.

The SBPAs provide for the payment of the principal component of purchase price plus an amount equal to 186 days of interest calculated at a maximum rate of 12%, based on a year of 360 days for tendered bonds during the weekly, monthly, quarterly, and semiannual rate modes in the event that the proceeds of a remarketing of the bonds are insufficient to pay the purchase price following an optional or mandatory tender. The SBPAs will expire on July 6, 2017 (for A-3), and July 6, 2019 (for A-4), the stated expiration dates, unless such dates are extended, conversion to a mode other than weekly, monthly, quarterly, or semiannual rate; or upon the occurrence of certain other events of default which result in a mandatory tender or other termination events related to the credit of the bond obligor which result in an automatic and immediate termination. The remarketing agent for the bonds is Barclays Capital Inc. The bonds are expected to be delivered on or about July 6, 2016.

The bonds will be issued in the weekly rate mode, but may be converted to a daily, monthly, quarterly, semiannual, VRO, and floating rate. While bonds bear interest in the weekly rate mode, interest is paid on each Jan. 1 and July 1, commencing Jan. 1, 2017. Holders of bonds bearing interest in the weekly rate mode may tender their bonds for purchase with the requisite prior notice. The trustee/tender agent is obligated to make timely draws on the SBPA to pay purchase price in the event of insufficient remarketing proceeds, and in connection with the expiration or termination of the SBPA, except in the case of the credit-related events permitting immediate termination or suspension of the SBPA.

Funds drawn under the SBPA are held uninvested, and are free from any lien prior to that of the bondholders. The bonds are subject to mandatory tender: (1) upon conversion of the interest rate; (2) upon expiration, or termination of the SBPA; and (3) following the receipt of written notice from the bank of an event of default under the SBPA, directing such mandatory tender. Optional and mandatory redemption provisions also apply to the bonds.

Bond proceeds will be used to pay and redeem all outstanding variable rate bonds of the series: 2003 series E; 2004 series A, B, C and D; and 2005 series A, D and E previously issued under the 2003 Indenture.

RATING SENSITIVITIES

The short-term rating reflects the short-term rating that Fitch maintains on the bank providing liquidity support and will be adjusted upward or downward in conjunction with the short-term rating of the bank and, in some cases, the long-term rating of the bond obligor.