News Column

Fitch Affirms North Mississippi Health Services (MS) Self-Liquidity Bonds at 'F1+'

June 26, 2014

NEW YORK--(BUSINESS WIRE)-- Fitch Ratings has affirmed the 'F1+' short-term rating on the following Mississippi Hospital Equipment and Facilities Authority revenue bonds (North Mississippi Health Services) issued on behalf of North Mississippi Health Services (NMHS) and supported by self-liquidity:

--$12,475,000 revenue bonds, 2003 series 1;

--$29,175,000 revenue bonds, 2003 series 2;

--$40,000,000 variable-rate revenue bonds, 2001 series 1;

--$18,190,000 variable-rate revenue bonds, 1997 series 1.

SECURITY

Pledge of net revenues of the obligated group (North Mississippi Medical Center, Clay County Medical Corporation, and Webster Health Services, Inc.)

KEY RATING DRIVERS

LIQUID RESOURCES AVAILABLE FOR UNREMARKETED PUTS: The 'F1+' rating is based on the sufficiency of NMHS's liquid resources and written procedures to fund the purchase price on each mandatory tender date. Based on Fitch's Rating Criteria related to Self-Liquidity, NMHS's eligible cash and investments would cover the maximum mandatory put on self-liquidity bonds on any given date in excess of Fitch's 1.25x threshold for the 'F1+' short-term rating. NMHS posts monthly liquidity reports on EMMA.

STRONG FINANCIAL PROFILE: Fitch maintains an 'AA-' long-term rating on NMHS outstanding revenue bonds. The long-term rating reflects NMHS's leading inpatient market share of 40%, a manageable debt burden, and robust liquidity. In addition, after posting a negative operating margin in fiscal 2013 (Sept. 30 year end), NMHS had operating income of $8.1 million in the fiscal 2014 six month interim period.

RATING SENSITIVITIES

MAINTENANCE OF ADEQUATE LIQUIDITY: Fitch expects NMHS to maintain adequate internal liquid resources to cover its total put exposure in excess of 1.25x to maintain the 'F1+' short-term rating.

For further research see, 'Fitch Downgrades North Mississippi Health Services (MS) Revs to 'AA-'; Affirms S-T at 'F1+'' dated July, 3 2013 and available at www.fitchratings.com.

Additional information is available at 'www.fitchratings.com'.

Applicable Criteria and Related Research:

--'Nonprofit Hospitals and Health Systems Rating Criteria', May 30, 2014;

--'Rating U.S. Public Finance Short-Term Debt', Dec. 9, 2013.

Applicable Criteria and Related Research:

U.S. Nonprofit Hospitals and Health Systems Rating Criteria

http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=746860

Rating U.S. Public Finance Short-Term Debt

http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=724680

Additional Disclosure

Solicitation Status

http://www.fitchratings.com/gws/en/disclosure/solicitation?pr_id=836764

ALL FITCH CREDIT RATINGS ARE SUBJECT TO CERTAIN LIMITATIONS AND DISCLAIMERS. PLEASE READ THESE LIMITATIONS AND DISCLAIMERS BY FOLLOWING THIS LINK: HTTP://FITCHRATINGS.COM/UNDERSTANDINGCREDITRATINGS. IN ADDITION, RATING DEFINITIONS AND THE TERMS OF USE OF SUCH RATINGS ARE AVAILABLE ON THE AGENCY'S PUBLIC WEBSITE 'WWW.FITCHRATINGS.COM'. PUBLISHED RATINGS, CRITERIA AND METHODOLOGIES ARE AVAILABLE FROM THIS SITE AT ALL TIMES. FITCH'S CODE OF CONDUCT, CONFIDENTIALITY, CONFLICTS OF INTEREST, AFFILIATE FIREWALL, COMPLIANCE AND OTHER RELEVANT POLICIES AND PROCEDURES ARE ALSO AVAILABLE FROM THE 'CODE OF CONDUCT' SECTION OF THIS SITE. FITCH MAY HAVE PROVIDED ANOTHER PERMISSIBLE SERVICE TO THE RATED ENTITY OR ITS RELATED THIRD PARTIES. DETAILS OF THIS SERVICE FOR RATINGS FOR WHICH THE LEAD ANALYST IS BASED IN AN EU-REGISTERED ENTITY CAN BE FOUND ON THE ENTITY SUMMARY PAGE FOR THIS ISSUER ON THE FITCH WEBSITE.



Fitch Ratings

Primary Analyst

Gary Sokolow, +1 212-908-9186

Director

Fitch Ratings, Inc.

33 Whitehall Street

New York, NY 10004

or

Secondary Analyst

Jennifer Kim, +1 212-908-0740

Associate Director

or

Committee Chairperson

James LeBuhn, +1 312-368-2059

Senior Director

or

Media Relations:

Elizabeth Fogerty, +1 212-908-0526

elizabeth.fogerty@fitchratings.com

Source: Fitch Ratings


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