Tobacco Bonds May Be Rated by Maturity.

• Position: Brief Article

Bonds backed by tobacco settlement payments could receive separate credit ratings for separate maturities, according to a senior director with Fitch IBCA Inc. Because it lessens the uncertainty, it is likely that tobacco bonds with shorter maturities will receive higher credit ratings than those with longer maturities. Although uncommon in most municipal deals, different ratings based on maturity are common with asset-backed bonds, such as home equity debt. Tobacco...