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BROWNSVILLE (TEXAS) UTILITIES SYSTEM PRIORITY BONDS RATED 'A' BY FITCH -- FITCH FINANCIAL WIRE --

BROWNSVILLE (TEXAS) UTILITIES SYSTEM PRIORITY BONDS RATED 'A' BY FITCH
 -- FITCH FINANCIAL WIRE --
 NEW YORK, April 7 /PRNewswire/ -- Brownsville (Texas) Utilities System's priority revenue bonds, Refunding Series 1992, are rated 'A' by Fitch. Fitch affirms its 'A' rating on the system's $170 million outstanding priority revenue bonds. The credit trend is stable.
 The ratings reflect historically solid financial performance, excellent management, an improving service territory, and adequate electrical generating capacity for the near term with attractive longer- term options. The addition of the Oklaunion coal plant in 1986 and improved financial controls have lowered rates and provided for an unusually accurate level of forecasting. Security features are good. For the fiscal year ended Sept. 30, 1992, priority lien debt service coverage was 1.82 times.
 Credit concerns center on perceived volatility in Rio Grande economies and below average income indicators. However, Fitch believes Brownsville's economy has been generally underrated and that a return to economic conditions of the past two decades is unlikely. Over the past five years, the Brownsville economy has shown marked improvement, aided by a strengthening Mexican economy, a strong maquiladora program, and a diversity of industry. Matamoros, directly across the Mexican border from Brownsville, is the third largest maquiladora in Mexico. A free trade pact between the U.S. and Mexico in the mid-1990s should have a positive economic impact.
 Of some concern is the possibility that the Brownsville economy will improve at a quickening pace, putting pressure on the utilities system to expand its electric facilities with attendant capital requirements. However, several capacity options exist which are not overly capital intensive, and future financial pressures may be negligible.
 -0- 4/7/92
 /CONTACT: Rebecca Bachman, 212-908-0516, or Alan Spen, 212-908-0594, both of Fitch/ CO: Brownsville Utilities System ST: Texas IN: UTI SU: RTG


CK -- NY032 -- 5827 04/07/92 12:10 EDT
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Publication:PR Newswire
Date:Apr 7, 1992
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