Wall Street Gives High Marks to Corridor Bonds
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LOS ANGELES COUNTY — About $1.2 billion in revenue bonds that will help finance a new rail expressway to the county’s ports received strong ratings Tuesday from three Wall Street firms that evaluate the economic risks of such instruments.
Fitch and Moody’s issued A and A2 ratings respectively for $1 billion in bonds scheduled for sale to investors later this month by the Alameda Corridor Transportation Authority. Standard and Poor’s rated the bonds BBB-plus.
The three agencies gave a second group of bonds totaling $165 million slightly lower grades of BBB-plus overall. The ratings reflect the fact that the second group of bonds has a lower priority for repayment than the first issue.
In general, bonds can be rated from a high of AAA for the lowest risk to D for the highest risk. Grades of BBB--typical investment grade--to AAA are considered favorable for investors.
The bonds will be used to build the $2.4-billion Alameda Corridor--a 20-mile train and truck route along Alameda Street that is expected to vastly improve the movement of cargo from the county’s fast-growing ports.
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