Fitch upgrades Seminole Tribe

Fitch Ratings said it upgraded the Seminole Tribe of Florida's issuer default rating to BB+ from BB, its gaming division bonds and term loan to BBB- from BB+ and its special obligation bonds to BB+ from BB. The outlook is stable.

The agency said the upgrade reflects its increased level of comfort about the tribe's governance practices since the agency downgraded all of the ratings to speculative grade in June 2010. The rating is also supported by the gaming division's strong competitive position in southeast Florida and monopoly in the Tampa area, considerable market/geographic diversification relative to other tribal gaming credits and solid credit metrics.

The issuer default rating is still being weighed down somewhat by the lack of an established track record of prudent governance practices at the tribal level in the context of concerns surrounding the tribe's leadership history, Fitch said.

Other concerns incorporated into the rating include the expiration of the tribe's authority to operate table games in 2015, possible legalization of expanded gaming in Florida, the need to address the term loan bullet coming due March 2014 and gaming division management's employment contracts expiring May 2013, the agency said.

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