Fitch Downgrades 4 Gas Pre-Pay Transactions

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NEW YORK--(BUSINESS WIRE)-- Fitch Ratings has downgraded the rating of the following prepaid gas transactions to 'A+' from 'AA-':

--Indiana Bond Bank (IBB), special program gas revenue bonds, series 2007A & B;

--Municipal Energy Acquisition Corporation (MEAC), gas project revenue bonds, series 2006A & B;

The rating action reflects Fitch's assessment of the credit quality of the various counterparties and enhancement providers and Fitch's Dec. 15, 2011 decision to downgrade the long-term Issuer Default Rating of BNP Paribas (BNP) to 'A+' from 'AA-' and to revise the Outlook to Stable. BNP is the commodity swap provider in each of the transactions noted above.

The Outlook on the MEAC series 2006A & B bonds is Stable.

The IBB series 2007A & B bonds will remain on Rating Watch Negative as Fitch continues to determine the credit quality of the unrated gas purchaser obligations and the benefit of the transaction's cash reserves.

WHAT COULD TRIGGER A RATING ACTION

Change in Counterparty Ratings: The long-term rating on the bonds will continue to be determined by Fitch's assessment of the transaction structure, the role of the remaining counterparties in the structure, and their credit quality.

Additional information is available at 'www.fitchratings.com'. The ratings above were solicited by, or on behalf of, the issuer, and therefore, Fitch has been compensated for the provision of the ratings.

Applicable Criteria and Related Research:

--'Guidelines for Rating Prepaid Energy Transactions' (Aug. 15, 2011);

--'Prepay Gas Transactions: Focus on Counterparty Risk'(Feb. 23, 2009).

Applicable Criteria and Related Research:

Prepay Gas Transactions: Focus on Counterparty Risk

http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=427254

Criteria for Rating Prepaid Energy Transactions

http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=648406

ALL FITCH CREDIT RATINGS ARE SUBJECT TO CERTAIN LIMITATIONS AND DISCLAIMERS. PLEASE READ THESE LIMITATIONS AND DISCLAIMERS BY FOLLOWING THIS LINK: HTTP://FITCHRATINGS.COM/UNDERSTANDINGCREDITRATINGS. IN ADDITION, RATING DEFINITIONS AND THE TERMS OF USE OF SUCH RATINGS ARE AVAILABLE ON THE AGENCY'S PUBLIC WEBSITE 'WWW.FITCHRATINGS.COM'. PUBLISHED RATINGS, CRITERIA AND METHODOLOGIES ARE AVAILABLE FROM THIS SITE AT ALL TIMES. FITCH'S CODE OF CONDUCT, CONFIDENTIALITY, CONFLICTS OF INTEREST, AFFILIATE FIREWALL, COMPLIANCE AND OTHER RELEVANT POLICIES AND PROCEDURES ARE ALSO AVAILABLE FROM THE 'CODE OF CONDUCT' SECTION OF THIS SITE.

Fitch RatingsPrimary Analyst:Dennis M. Pidherny, +1-212-908-0738Senior DirectorFitch, Inc.One State Street PlazaNew York, NY 10004orSecondary Analyst:Michael Murad, +1-212-908-0757Associate DirectororCommittee Chairperson:Alan Spen, +1-212-908-0594Senior DirectororMedia Relations:Sandro Scenga, New York, +1-212-908-0278[email protected]

Source: Fitch Ratings

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