KEY RATING DRIVERS
LIQUID RESOURCES AVAILABLE FOR UNREMARKETED PUTS: The 'F1+' rating reflects Advocate's availability of highly liquid resources to cover the mandatory tender on its put bonds. At
STRONG FINANCIAL PROFILE: Fitch rates Advocate's long-term obligations at 'AA'. The long-term rating reflects Advocate's consistently strong operating performance, light debt burden, robust liquidity and leading market position. Advocate's solid operating cash flow generation continues to support substantial balance sheet strength and its liquidity indicators consistently exceed Fitch's 'AA' category median ratios.
MAINTENANCE OF ADEQUATE LIQUIDITY: Fitch expects Advocate to sustain adequate internal liquid resources to cover its total put exposure in excess of 1.25x to maintain the 'F1+' short-term rating.
Advocate is an integrated health care system serving the
Fitch's analysis is based on the consolidated system. The obligated group consists of
Advocate provided Fitch with an internal procedures letter outlining the procedures to meet any un-remarketed puts. In addition, Advocate provides monthly liquidity reports to Fitch to monitor the sufficiency of Advocate's cash and investment position relative to its mandatory put exposure.
Advocate's disclosure includes annual audited financial statements as well as quarterly unaudited balance sheet, income statement, cash flow statement, an extensive MD&A, and utilization statistics. The information is posted to the Municipal Securities Rulemaking Board's EMMA system. In addition, management holds routine calls with rating agencies and with investors. Fitch considers Advocate's disclosure standards to be best practice.
Additional information is available at 'www.fitchratings.com'.
--'Rating U.S. Public Finance Short-Term Debt', (
--'U.S. Nonprofit Hospitals and Health Systems Rating Criteria' (
Rating U.S. Public Finance Short-Term Debt
U.S. Nonprofit Hospitals and Health Systems Rating Criteria
Emily E. Wadhwani, +1 312-368-3347
Kathleen Proux, +1 312-368-3348
James LeBuhn, +1 312-368-2059
Source: Fitch Ratings
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