DC Housing Finance Agency Gets Upgrade in Credit Rating
Standard & Poor’s believes that the District of Columbia Housing Finance Agency (DCHFA) has made improvements in recent years: the S&P’s Rating Services has raised its issuer credit rating for the DCHFA from “BBB” to “A-“ and raised its underlying rating on the agency’s certificates of participation services from “BBB-“ to “BBB+”.
S&P based its opinion on: the high quality and very low risk profile of the DCHFA’s asset base; the agency’s reasonable financial performance; its minimal general obligation debt exposure; its active management team that is seeking to increase the agency’s asset base; and the agency’s success in meeting its legislative mandate and maintaining a strong and positive relationship with the district government.
Although the DCHFA is small geographically, it has managed to expand its loan portfolio by 10 percent during the past year. The bulk of its loan portfolio was insured by government and private mortgage insurance providers or backed by Ginnie Mae, Fannie Mae, or Freddie Mac mortgage-backed securities.
According to the S&P report, the DCHFA saw a decrease in total expenses to $78 million in fiscal year 2008, following an 8 percent decline over fiscal year 2007. This was because the agency was no longer participating in the Section 8 program.