Fitch Ratings has downgraded to A from A-plus the Puerto Rico Housing Finance Authority’s $384.5 million capital fund program bonds, Series A and B of 2008. The outlook is negative.

Fitch cited the authority’s decreasing debt-service coverage and appropriations, which fell 17% in fiscal 2011 and 7% in fiscal 2012.

“Further declines in the public housing capital fund annual appropriations may put debt-service coverage levels below current rating thresholds,” Fitch analysts said in a report.

The recent trend of declines in appropriations and the remaining 15 years to maturity on the bonds are the center of credit concerns and basis for the negative outlook, Fitch said.

Subscribe Now

Independent and authoritative analysis and perspective for the bond buying industry.

14-Day Free Trial

No credit card required. Complete access to articles, breaking news and industry data.