Standard & Poor's Ratings Services said it has placed on CreditWatch with negative implications the ratings of 25 housing bond issues partially supported by guaranteed investment contracts (GICs) from certain American International Group companies.
Standard & Poor's said it examined all housing bond issues with partial credit support by American International Group, AIG Matched Funding Corp., or AIG Financial Products Corp. "For the local issuers, Standard & Poor's looked at the issue's reliance upon return of principal and investment earnings to meet bond payment obligations," the rating agency said.
Should those issuers act to replace or guarantee the existing agreements, Standard & Poor's said, or if they can demonstrate the ability to make bond payment obligations without relying on the interest earnings on the GIC, ratings will be reviewed upon the issuer's request.
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