Standard & Poor's Ratings Services said it lowered its long-term rating to A-plus from AA-minus on various revenue bonds issued for Baylor University, Texas.

In addition, Standard & Poor's assigned its A-plus rating to the approximately $200 million series 2012A taxable revenue bonds issued for Baylor University. Finally, Standard &Poor's also affirmed its A-1-plus short-term rating on the university's taxable commercial paper notes. The outlook is stable.

"The downgrade reflects the significant increase in debt coupled with already low financial resources that were further diluted with this debt issuance," said Standard & Poor's credit analyst Bianca Gaytan-Burrell. "Though we understand that the debt issued has improved the physical campus and, consequently, has attracted students, we believe it has also pressured the balance sheet," added Gaytan-Burrell.

Proceeds from the series 2012A bonds will be used to refund all or a portion of the university's CP notes, series A, and to refinance all or a portion of the costs of constructing, renovating, acquiring, and equipping certain projects, including the new, on-campus Baylor Stadium and a new School of Business.

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