Fitch Rates San Francisco PUC, CA's CP Notes, (Power Series) Series A-1 'F1'
KEY RATING DRIVERS:
The rating is based on the support provided by an irrevocable direct-pay letter of credit (LOC) issued by Bank of America, N.A. (BANA, rated 'A+/F1'/Stable Outlook), which has a stated expiration date of Dec. 3, 2018 unless extended or earlier terminated. The BANA LOC provides coverage for the principal amount of the notes and interest due on the maturity dates of the notes.
U.S. Bank National Association, as Issuing and Paying Agent (IPA) for the notes is directed to request an advance under the LOC to pay principal and interest on maturing notes. The LOC provides sufficient coverage for the principal amount of notes plus 270 day of interest calculated at 12% based upon a 365 day year.
All notes will be issued at par, with interest due at maturity. Following the occurrence of an event of default under the LOC, BANA may direct the IPA to immediately stop the issuance of any additional notes. BANA may also notify the IPA that the stated amount of the LOC will be reduced to an amount equal to the principal amount of notes then outstanding plus interest payable on the notes and further reduce the stated amount as each CP note matures and note is paid. In addition, BANA has the option of issuing a final drawing notice directing the IPA to draw on its LOC for the principal and interest amount due on all outstanding notes. The proceeds of the final drawing will be held by the IPA and applied to pay off the notes as they mature. RBC Capital Markets LLC., Goldman, Sachs &Co., and Barclays Capital Inc. are the dealers for the notes.
RATING SENSITIVITIES
The rating is exclusively tied to the short-term rating that Fitch maintains on the bank providing the LOC and will reflect all changes to that rating.
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