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Connecticut Housing Finance Authority Series 2019A-1 And 2019A-4 Housing Mortgage Finance Program Bonds Rated 'AAA'

NEW YORK (S&P Global Ratings) Feb. 1, 2019--S&P Global Ratings has assigned 
its 'AAA' long-term rating to the Connecticut Housing Finance Authority's 
(CHFA) series 2019A-1 and 2019A-4 housing mortgage finance program (HMFP) 
bonds. At the same time, S&P Global Ratings affirmed its 'AAA', 'AAA/A-1+', 
and 'AAA/A-1' ratings on all debt under the authority's HMFP bond resolution. 
The outlook on all issues is stable. 

"The rating reflects our view of the very strong credit quality of the single- 
and multifamily mortgage collateral, sufficient loss coverage, sufficient cash 
flow strength, and the equal and ratable pledge of all bonds under the 
resolution," said S&P Global Ratings credit analyst David Greenblatt.

The authority's HMFP consists of $4.8 billion in mortgage assets, with 
approximately 73% single-family and 27% multifamily. As of June 2018, this 
included approximately $1.6 billion in single-family whole loans, $1.8 billion 
in single-family mortgage-backed securities, and $1.3 billion in multifamily 
whole loans.

The CHFA expects to issue series 2019A bonds in the principal amount of $122.7 
million and use approximately $35.3 million in available money under its 
resolution to finance new single-family home mortgage loans, and to refund 
previously issued bonds, including the economic refunding of previously issued 
series 2018E-3 and 2018E-4 certificates of obligation. In addition, funds will 
pay issuance costs as well as underwriters' compensation and expenses.

The stable outlook reflects our opinion of the resolution's overall financial 
strength and the authority's strong oversight. The bonds issued in accordance 
with the resolution benefit from, in our view, a solidly performing and 
generally low-risk loan portfolio, high-quality investments, and a strong 
opening asset-to-liability parity of 124.5%, as of Jan. 1, 2018, a slight 
increase from the previous year's parity of 124.0%. After adjusting for our 
analysis of potential loan loss at the current rating level, the adjusted 
parity was 106.2% at the low parity date of May 15, 2019, which we view as 
sufficient to cover potential loan loss.

We could revise the resolution's outlook to negative or lower the rating 
should the authority's adjusted parity decline closer to, or below, 100%, the 
percentage of delinquent loans increases, or the level of unhedged 
variable-rate debt rises. We could also take a negative rating action if the 
CHFA cannot satisfy our stress loss coverage requirements for a 'AAA' rating 
through overcollateralization.
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