Printer Friendly

THE HIGHLANDS AT WYOMISSING (PA.) $23.1M BONDS RATED 'A+' BY FITCH -- FITCH FINANCIAL WIRE --

 THE HIGHLANDS AT WYOMISSING (PA.) $23.1M BONDS RATED 'A+' BY FITCH
 -- FITCH FINANCIAL WIRE --
 NEW YORK, April 22 /PRNewswire/ -- Berks County Municipal Authority (Pa.) $23.1 million revenue bonds, Series B of 1992 (the Highlands at Wyomissing Project) are rated "A+" by Fitch. The credit trend is stable. Bond proceeds will refinance existing debt.
 The rating reflects the long-term credit enhancement provided in the form of a secured guaranty of payment of the bonds by the Reading Hospital and Medical Center. The guaranty is on a revenue-pledge parity with existing debt of Reading Hospital.
 The guaranty's nominal cancellation date is in the year 2002, which is prior to the final maturity of the bonds. This creates the possibility of a mandatory call payable by the Highlands or Reading Hospital. Given the circumstances under which the guaranty would not be extended, Reading Hospital's liquidity risk of forcing itself to pay for a mandatory call is viewed as highly remote.
 The rating incorporates a variable rate sensitivity analysis with regard to an imminent $18.9 million future financing bond issue, i.e. the Series A of 1992. Proceeds of the Series A bonds will be used to refinance $13.3 million of existing debt and fund approximately $5.2 million of new construction. The Series A bonds are expected to be issued within 60 days of the Series B bonds. Interest rates are expected to fluctuate because the Series A bonds are expected to be issued in a Dutch auction interest rate mode.
 Reading Hospital, a 627-bed major regional health care center, possesses very strong credit qualities. Fiscal 1991 net funds available for debt service totaled $22.4 million. In a worst case scenario, total annual debt service would equal $14.8 million. Under this worst case scenario, the 1991 historic pro forma debt service coverage ratio is a very strong 1.51 times (x). The hospital's debt and liquidity positions are also very favorable.
 The primary obligor, the Highlands at Wyomissing, operates a continuing care retirement community (CCRC) which is nearing the end of its fill-up stage. Fitch expects that the Highlands will be able to service the $3.3 million expected annual debt service payments on its own; no performance on the guaranty is expected.
 Concerns include the limited operating history of the Highlands. Stabilized full occupancy has not yet been achieved. The CCRC contract offers unlimited nursing care at no extra charge. Meaningful closed- group actuary history is lacking. Finally, Reading Hospital is in the planning stages of several construction projects that are expected to cost $43.0 million and be internally funded. While no debt is expected to be incurred, the cash drain is noted.
 -0- 4/22/92
 /CONTACT: Edward C. Merrigan of Fitch, 212-908-0513/ CO: Berks County Municipal Authority; Highlands at Wyommissing ST: Pennsylvania IN: HEA SU: RTG


GK -- NY080 -- 1376 04/22/92 14:48 EDT
COPYRIGHT 1992 PR Newswire Association LLC
No portion of this article can be reproduced without the express written permission from the copyright holder.
Copyright 1992 Gale, Cengage Learning. All rights reserved.

Article Details
Printer friendly Cite/link Email Feedback
Publication:PR Newswire
Date:Apr 22, 1992
Words:482
Previous Article:PANHANDLE EASTERN DECLARES QUARTERLY DIVIDEND
Next Article:UNILAB ANNOUNCES DATE OF STOCKHOLDERS' ANNUAL MEETING


Related Articles
DADE COUNTY, FLORIDA GENERAL OBLIGATION BONDS RATED 'A+' BY FITCH -- FITCH FINANCIAL WIRE --
VIRGINIA ELECTRIC $680 MILLION SENIOR DEBT RATED 'A+' BY FITCH -- FITCH FINANCIAL WIRE --
CHELAN COUNTY (WASH.) $20 MILLION PUBLIC UTILITY DISTRICT NO. 1 BONDS RATED 'A+' -- FITCH FINANCIAL WIRE --
TRINITY RIVER AUTHORITY OF TEXAS WASTEWATER REVENUE BONDS RATED 'A+' BY FITCH -- FITCH FINANCIAL WIRE --
AUSTIN, TEXAS COMBINED UTILITY SYSTEMS BONDS RATED 'A+' BY FITCH -- FITCH FINANCIAL WIRE --
BALTIMORE WATER, WASTEWATER BONDS RATED 'A+' BY FITCH -- FITCH FINANCIAL WIRE --
LOS ANGELES WASTEWATER REVENUE BONDS RATED 'A+' BY FITCH -- FITCH FINANCIAL WIRE --
ORLANDO (FLA.) CONVERTIBLE LIEN REFUNDING SPECIAL REVENUE BONDS 'A+' BY FITCH -- FITCH FINANCIAL WIRE --
VIRGINIA ELECTRIC $370 MILLION SENIOR DEBT RATED 'A+' BY FITCH -- FITCH FINANCIAL WIRE --
WEST VIRGINIA $58.8 MILLION G.O. HIGHWAY BONDS RATED 'A+' BY FITCH -- FITCH FINANCIAL WIRE --

Terms of use | Copyright © 2016 Farlex, Inc. | Feedback | For webmasters