OREANDA-NEWS. Fitch Ratings has affirmed the short-term rating at 'F1+' assigned to the $200,000,000 Department of Water and Power of the City of Los Angeles (CA) power system revenue commercial paper notes (notes). A maximum of $200,000,000 aggregate principal amount of authorized notes may be outstanding at any given time.

The rating action is in connection with (i) the substitution of the previous revolving credit agreement (RCA) provided by Wells Fargo Bank, National Association (rated 'AA/F1+', Stable Outlook) which had supported the notes, with a RCA provided by Royal Bank of Canada, (Royal Bank; rated 'AA/F1+', Negative Outlook) and (ii) the reoffering of the notes.

KEY RATING DRIVERS

The 'F1+' rating on the notes is based on the support provided by a RCA issued by Royal Bank which has a stated expiration date of June 28, 2019, unless extended or earlier terminated. The Royal Bank substitute RCA covers principal only. The Department of Water and Power of the City of Los Angeles remains obligated to pay interest upon maturity of all notes. Fitch currently rates the power system revenue obligations of the Department of Water and Power of the City of Los Angeles 'AA-', Positive Outlook (see new issue report dated May 4, 2016, available at www. Fitchratings. com)

U. S. Bank, National Association will continue as the Issuing and Paying Agent (IPA) for the notes, and as IPA, is directed to request an advance under the substitute RCA whenever proceeds of the sale of rollover notes and department monies are insufficient to pay principal of maturing notes.

All notes will be issued at par, with interest due at maturity. Following the occurrence of an event of default under the RCA, Royal Bank of Canada may direct the IPA to immediately stop the issuance of any additional notes. In such event, the substitute RCA will expire after all the notes supported by such RCA mature and have been paid from funds drawn on the substitute RCA. In addition, the RCA may be terminated at Royal Bank of Canada's option upon the occurrence of specified immediate termination events related to the credit of the issuer. The dealers for the notes are J. P. Morgan Securities Inc. and Ramirez & Co., Inc.

RATING SENSITIVITIES

The rating reflects the short-term rating that Fitch maintains on the substitute bank providing liquidity support and will be adjusted upward or downward in conjunction with changes to the short-term rating of the bank and in some cases, the long-term rating of the Department of Water and Power of the City of Los Angeles.