Rather than fund loans to local government borrowers by issuing bonds under the state guaranteed program, the NHMBB has instead issued bonds under its non-state guaranteed 1978 (rated 'AA-'; Stable Outlook by Fitch) and 2005 (not rated by Fitch) resolutions.
Neither the intercept nor the moral obligation has ever been utilized because no borrower has defaulted on a loan repayment since NHMBB began operations in 1977.
SOLID PROGRAM MANAGEMENT AND UNDERWRITING: The NHMBB maintains sound underwriting and loan monitoring procedures as evidenced by the fact that the program has not experienced a local government default to date.
STRESS TEST RESULTS: If the program is unable to pass Fitch's 'AA'-category stress test after receipt and analysis of expected information from NHMBB, a downgrade is highly likely.
Fitch analyzed the default tolerance of the NHMBB loan pool using a stress test it also applies to state revolving funds and other municipal loan pools.
Neither the intercept nor the MO has ever been utilized, because no borrower has defaulted on a loan repayment since the NHMBB began operations.
In the unlikely event of a missed loan payment, the NHMBB has the ability to intercept any state funds payable to a borrower and use it for the loan payment.
surety policies in its rating analysis of the NHMBB 2005 resolution bonds.
26, 2008 after the NHMBB
discontinued use of the 2005 Resolution in favor of its 1978 General Bond Resolution; Fitch was concerned that the 2005 Resolution borrower pool would become less diversified as the existing loans ran off.
Additional credit enhancement is provided by a state intercept, whereby, in the event a borrower defaults on a loan repayment, NHMBB
has the ability to intercept any state funds payable to the borrower.
NHMBB will loan the 2006B proceeds to six local governmental entities for various capital improvements.
NHMBB created the pool pursuant to a new bond resolution in July 2005 under which future nonguaranteed bonds are expected to be issued to fund loans for local entities.