News Column

Fitch Affirms Brazil Loan Trust I Notes at 'BBBsf'; Outlook Stable

July 31, 2014

SAO PAULO--(BUSINESS WIRE)-- Fitch Ratings has affirmed the following rating assigned to the senior secured pass-through notes issued by Brazil Loan Trust I (the issuer):

Brazil Loan Trust I Notes

-- USD661.9 million notes 'BBBsf'; Outlook Stable.

The transaction is a pass-through securitization of a 10-year amortizing loan originated by Bank of America N.A. (BofA) to the Brazilian State of Maranhao (rated 'BB+'/ Outlook Stable by Fitch). The loan is guaranteed on an unconditional and irrevocable basis by the Federative Republic of Brazil (Brazil, rated 'BBB'/ Outlook Stable). Fitch's rating addresses timely payment of interest and principal.

KEY RATING DRIVERS

The affirmation of the rating reflects (i) the credit quality of the guaranty provider, Brazil; and (ii) the credit quality of the main transaction counterparties. The affirmation also reflects the timely payments of interest due in January and July 2014.

Fitch affirmed the Issuer Default Rating (IDR) of Brazil at 'BBB'/ Outlook Stable on July 10, 2014.

Payments on the loan are made to a bank account at Wilmington Trust N.A. (IDR 'A-'/ Outlook Positive) as administrative agent. On the following day, funds are transferred to an Issuer account at the Bank of New York Mellon (IDR 'AA-'/ Outlook Stable) as indenture trustee to the notes. Payments are made under the notes immediately thereafter.

RATING SENSITIVITIES

The rating assigned to the notes is sensitive to changes in the credit quality of Brazil as guarantor on an unconditional and irrevocable basis. While Brazil's rating remains higher than the long-term rating of Maranhao, the transaction's rating will not be sensitive to the rating assigned to Maranhao. The transaction's rating is equivalent to the higher of Brazil's long-term or Maranhao's long-term rating.

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

Sources of information: Transaction documents.

Applicable Criteria and Related Research:

--'Global Rating Criteria for Single- and Multi-Name Credit-Linked Notes' Feb. 19, 2014;

--'Global Structured Finance Rating Criteria' May 20, 2014;

--'Counterparty Criteria for Structured Finance and Covered Bonds' May 11, 2014;

--'Brazil Loan Trust I' (August 13, 2013);

--'Maranhao, State of' (June 5, 2014);

--'Brazil' (July 18, 2014).

Applicable Criteria and Related Research:

Counterparty Criteria for Structured Finance and Covered Bonds

http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=744158

Global Structured Finance Rating Criteria

http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=748821

Global Rating Criteria for Single- and Multi-Name Credit-Linked Notes

http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=729785

Brazil

http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=752350

Maranhao, State of

http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=748424

Brazil Loan Trust I

http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=715622

Additional Disclosure

Solicitation Status

http://www.fitchratings.com/gws/en/disclosure/solicitation?pr_id=843354

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

Robert Krause

Director

+55 11 4504 2211

Fitch Ratings Ltda.

Alameda Santos 700, 7th Floor

Sao Paulo - SP

or

Secondary Analyst

Juliana Ayoub

Associate Director

+55 11 4504 2200

or

Committee Chairperson

Jayme Bartling

Senior Director

+55-11-4504-2602

or

Media Relations, New York

Elizabeth Fogerty, +1 212-908-0526

elizabeth.fogerty@fitchratings.com


Source: Fitch Ratings


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