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ARKANSAS ELECTRIC CO-OP GUARANTEED PCR BONDS RATED 'A+' BY FITCH -- FITCH FINANCIAL WIRE --

 NEW YORK, Sept. 10 /PRNewswire/ -- Jefferson County, AR's $7.55 million National Rural Utilities Cooperative Finance Corp. guaranteed pollution control revenue refunding bonds (Arkansas Electric Cooperative Corp. Project) series 1993J and Independence County, AR's $12.61 million National Rural Utilities Cooperative Finance Corp. guaranteed pollution control revenue refunding bonds (Arkansas Electric Cooperative Corp. Project) series 1993K are rated 'A+' by Fitch. The credit trend is stable. The bonds were priced Sept. 8 by a Goldman, Sachs & Co. led syndicate.
 The ratings reflect the unconditional guarantee provided by National Rural Utilities Cooperative Finance Corp. (CFC) to make full and timely payments of principal and interest on the bonds. CFC is a not-for- profit cooperative association responsible for providing its rural electric cooperative members with supplemental financing to the Rural Electric Administration's (REA) loan program. In addition to direct loans, CFC provides guarantees for tax-exempt financing of pollution control facilities and other properties constructed or acquired by its members.
 CFC's sound financial performance continues, despite recent financial difficulties of some of its larger borrowers. For fiscal year ended May 31, 1993, CFC reported a times interest earned ratio (TIER) of 1.16 times (x), above targeted levels. Added protection is provided by a $172.6 million allowance for loan and guarantee losses, which as of May 31, 1993, represented 2.13 percent of total loans and guarantees outstanding. Other strengths include a large and diverse membership and a first lien on members' assets and future revenues. Credit concerns include continued exposure to Deseret Generation & Transmission Cooperative, one of CFC's larger borrowers, which is operating under a restructuring agreement with its major creditors, and uncertainty related to the changing rural electric cooperative industry.
 Arkansas Electric Cooperative Corp. (AECC) is a generation and transmission co-op providing wholesale electric service to 16 distribution cooperative members throughout much of Arkansas. Its ample, well balanced resource mix includes ownership or lease interests in numerous coal, hydro, and gas/oil-fired generating units. AECC has a history of satisfactory financial operations. In fiscal 1992, AECC reported an equity to capitalization of 25 percent and a 1.30x TIER. Concerns include risks associated with rate regulation by the Arkansas Public Service Commission and Arkansas's below average overall wealth levels.
 -0- 9/10/93
 /CONTACT: Susan M. Courtney, 212-908-0503 or Alan Spen, 212-908-0594, both of Fitch/


CO: Arkansas Electric Cooperative Corp. ST: Arkansas, New York IN: UTI SU: RTG

WB -- NY031 -- 0727 09/10/93 11:40 EDT
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Date:Sep 10, 1993
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