Moody's gives Baa2 to Upper Chesapeake Health bonds

Moody's Investors Service said it assigned Baa2 underlying ratings to the $65.065 million series 2008A health care revenue bonds and $60.215 million series 2008B bonds to be issued by the Maryland Health and Higher Educational Facilities Authority for Upper Chesapeake Health System. The outlook is negative.

The expected sale date is Aug. 7 for series 2008B and Aug. 8 for series 2008A.

The variable-rate demand bonds are expected to be supported by letters of credit from Bank of America NA and Branch Banking & Trust Co., respectively. Moody's will assign primary ratings based on the letters of credit.

Proceeds will be used to refund the series 2007A&B bonds and to pay certain costs of issuance. The series 2007C bonds are expected to be converted to fixed-rate mode from auction rate.

Moody's affirmed the underlying rating of Baa2 and negative outlook on Upper Chesapeake's outstanding bonds.

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