Maryland CDA – Business Development Revenue Bonds — Moody’s assigns A1 to Maryland CDA’s


Rating Action: Moody’s assigns A1 to Maryland CDA’s Business Development Revenue Bonds 2022 Series A; outlook stableGlobal Credit Research – 25 Mar 2022New York, March 25, 2022 — Moody’s Investors Service has assigned A1 rating to the Maryland Community Development Administration’s $17.4 million Business Development Revenue Bonds 2022 Series A (Federally Taxable). The outlook is stable.RATINGS RATIONALEThe A1 rating on the Business Development Revenue Bonds indenture is based upon the A1 issuer rating of Maryland Community Development Administration. Maryland CDA has established a reserve within its General Bond Reserve Fund in an amount equal to the outstanding principal balance of the 2022 Series A Loans. The trustee can tap this reserve in order to purchase delinquent Business Development Revenue Bond loans, providing security for the loan portfolio.RATING OUTLOOKThe outlook is stable based upon the stable outlook of the A1 issuer rating of Maryland CDA.FACTORS THAT COULD LEAD TO AN UPGRADE OF THE RATING- An upgrade of Maryland CDA’s issuer rating.FACTORS THAT COULD LEAD TO A DOWNGRADE OF THE RATING- A downgrade of Maryland CDA’s issuer rating.LEGAL SECURITYThe Series 2022A Bonds are special obligations of the Administration payable solely from the revenues and property pledged under the Resolution. The Resolution provides for the issuance of additional bonds which may be secured equally and ratably on parity with the Series 2022A Bonds.Upon the delivery of the Series 2022A Bonds, the Administration will deposit in the Loan Advance Fund six months of principal and interest payable on each of the 2022 A loans. If any loan is delinquent in payment of principal or interest, the Administration will withdraw the amount of the deficiency from the Loan Advance Fund. If, the amount on deposit in the Loan Advance Fund is below the six month requirement for four consecutive months, the Trustee will withdraw an amount equal to the outstanding principal amount of the delinquent loan from the Business Development Bond Account under the General Bond Reserve Fund and purchase the delinquent loan on behalf of the Administration. Upon the purchase, the loan will be transferred to the General Bond Reserve Fund and will no longer be pledged to the holders of the Bonds. The Trustee will apply the funds transferred to it from the trustee for the General Bond Reserve Fund to effect a special redemption of the Bonds.The Business Development Bond Account will be established within the administration’s General Bond Reserve Fund. The Administration will deposit funds in the Business Development Bond Account in an amount that equals the outstanding principal balance of the 2022 Series A loans. Amounts on deposit in the Business Development Bond Account, to the extent available, may (but are not required to) be used to pay the principal of and interest on the Bonds, and other bonds and notes of the Administration. The Administration may also use moneys in the Business Development Bond Account for any purpose permitted by the GBRF Indenture, which includes using the moneys to cover operating costs of the Administration.USE OF PROCEEDSThe Administration will apply the proceeds of the Series 2022A Bonds to acquire and transfer business loans from its General Bond Reserve Fund Indenture to the Resolution.PROFILEThe obligor is the Business Development Revenue Bonds resolution established in March 2022. This is a parity bond resolution used for the purpose of financing business development loans for the administration. The Administration is authorized to provide loans to for profit and nonprofit businesses to finance and refinance the acquisition, ownership, development, construction, rehabilitation or improvement of business development projects in priority funding areas in Maryland.METHODOLOGYThe principal methodology used in this rating was US Housing Finance Agency Issuer Ratings Methodology published in October 2019 and available at https://www.moodys.com/researchdocumentcontentpage.aspx?docid=PBM_1154472. Alternatively, please see the Rating Methodologies page on www.moodys.com for a copy of this methodology.REGULATORY DISCLOSURESFor further specification of Moody’s key rating assumptions and sensitivity analysis, see the sections Methodology Assumptions and Sensitivity to Assumptions in the disclosure form. Moody’s Rating Symbols and Definitions can be found at: https://www.moodys.com/researchdocumentcontentpage.aspx?docid=PBC_79004.For ratings issued on a program, series, category/class of debt or security this announcement provides certain regulatory disclosures in relation to each rating of a subsequently issued bond or note of the same series, category/class of debt, security or pursuant to a program for which the ratings are derived exclusively from existing ratings in accordance with Moody’s rating practices. For ratings issued on a support provider, this announcement provides certain regulatory disclosures in relation to the credit rating action on the support provider and in relation to each particular credit rating action for securities that derive their credit ratings from the support provider’s credit rating. For provisional ratings, this announcement provides certain regulatory disclosures in relation to the provisional rating assigned, and in relation to a definitive rating that may be assigned subsequent to the final issuance of the debt, in each case where the transaction structure and terms have not changed prior to the assignment of the definitive rating in a manner that would have affected the rating. For further information please see the ratings tab on the issuer/entity page for the respective issuer on www.moodys.com.Regulatory disclosures contained in this press release apply to the credit rating and, if applicable, the related rating outlook or rating review.Moody’s general principles for assessing environmental, social and governance (ESG) risks in our credit analysis can be found at http://www.moodys.com/researchdocumentcontentpage.aspx?docid=PBC_1288235.Please see www.moodys.com for any updates on changes to the lead rating analyst and to the Moody’s legal entity that has issued the rating.Please see the ratings tab on the issuer/entity page on www.moodys.com for additional regulatory disclosures for each credit rating. Rachael McDonald Lead Analyst Housing Moody’s Investors Service, Inc. 7 World Trade Center 250 Greenwich Street New York 10007 JOURNALISTS: 1 212 553 0376 Client Service: 1 212 553 1653 Eva Bogaty Additional Contact PF Healthcare JOURNALISTS: 1 212 553 0376 Client Service: 1 212 553 1653 Releasing Office: Moody’s Investors Service, Inc. 250 Greenwich Street New York, NY 10007 U.S.A JOURNALISTS: 1 212 553 0376 Client Service: 1 212 553 1653 © 2022 Moody’s Corporation, Moody’s Investors Service, Inc., Moody’s Analytics, Inc. and/or their licensors and affiliates (collectively, “MOODY’S”). All rights reserved.CREDIT RATINGS ISSUED BY MOODY’S CREDIT RATINGS AFFILIATES ARE THEIR CURRENT OPINIONS OF THE RELATIVE FUTURE CREDIT RISK OF ENTITIES, CREDIT COMMITMENTS, OR DEBT OR DEBT-LIKE SECURITIES, AND MATERIALS, PRODUCTS, SERVICES AND INFORMATION PUBLISHED BY MOODY’S (COLLECTIVELY, “PUBLICATIONS”) MAY INCLUDE SUCH CURRENT OPINIONS. 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