Fitch Affirms State of Hawaii DBEDT Green Energy Market Securitization Bonds 2014 Series A
KEY RATING DRIVERS
The transaction is performing within expectations, with levels of outstanding principal in-line with their targeted amortization schedules and no shortfalls in the capital subaccount. Additionally, the true-up mechanism continues to provide adequate credit support for all outstanding classes.
RATING SENSITIVITIES
As part of its initial rating sensitivity, Fitch conducted a break the bond case which provides an alternative means by which to measure the potential effects of rapid, significant declines in customer count while capping the residential GIF at 20% of the total residential customer bill. This analysis determines the maximum level of customer decline that would cause a default in required payments on the securitization or cause the GIF to exceed 20% of the total residual customer bill. Despite this severe decline, due to the true-up mechanism, GIFs are able to pay all debt service by the legal final maturity date.
For further detail on the rating sensitivity analysis for Utility Tariff Bonds, please refer to Fitch's criteria titled Rating Criteria for U.S. Utility Tariff Bonds available at 'www.fitchratings.com'.
DUE DILIGENCE USAGE
No third party due diligence was provided or reviewed in relation to this rating action.
Fitch's analysis of the Representations and Warranties (R&W) of State of Hawaii Department of Business, Economic Development, and Tourism Green Energy Market Securitization Bonds 2014 Series A can be found in 'State of Hawaii Department of Business, Economic Development, and Tourism Green Energy Market Securitization Bonds 2014 Series A - Appendix'. These R&W are compared to those of typical R&W for the asset class as detailed in the special report 'Representations, Warranties, and Enforcement Mechanisms in Global Structured Finance Transactions' dated June 12, 2015.
Fitch has affirmed the following ratings for State of Hawaii Department of Business, Economic Development, and Tourism Green Energy Market Securitization Bonds 2014 Series A:
--Class A-1 notes at 'AAAsf'; Outlook Stable;
--Class A-2 notes at 'AAAsf'; Outlook Stable.
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