LOS ANGELES — Bank downgrades and looming changes to bank collateral requirements under Basil III compelled San Diego-based Point Loma Nazarene University to sell its bonds directly to Bank of America rather than renewing a letter of credit due to expire this month.

School officials at the Christian liberal arts college decided they no longer wanted the risk of having a bank LOC backing $31.72 million in outstanding bonds in view of the bank downgrades that have occurred, particularly since the bonds were trading at a weekly variable rate, said George Latter Jr., Point Loma’s vice president of finance for administrative services.

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