NEW YORK – Effective Oct. 22, 2009, Fitch Ratings will upgrade the ratings assigned to the $50,000,000 Maryland Health and Higher Educational Facilities Authority revenue bonds, University of Maryland Medical System Issue, series 2008D (the bonds) to 'AA+/F1+' from 'A/F1'.

The rating action is taken in connection with the Oct. 22, 2009 replacement of the irrevocable, direct-pay letter of credit (LOC) provided by Sun Trust Bank with a substitute LOC provided by TD Bank, N.A. (TD Bank, rated 'AA-/F1+' by Fitch).

The upgrade of the long-term rating assigned to the bonds will reflect both the underlying rating assigned to the revenue bonds of the University of Maryland Medical System Corporation (UMMS, rated 'A'), and the support provided by the TD Bank LOC supporting the bonds. The short-term 'F1+' rating to be assigned to the bonds will be based solely on the LOC.

The long-term rating will be based on Fitch's dual-party pay methodology which considers the likelihood of the failure of both a rated obligor and a bank LOC provider. The methodology results in a rating that is up to two notches higher than the stronger of the two credits if the following conditions are met: (1) both entities have a rating of 'A' or higher; (2) the transaction is structured such that payments from both the rated obligor and the bank are in the flow of funds and both entities would have to fail to perform before the bonds defaulted; and (3) the credit of the bank and the rated obligor have no more than a medium degree of correlation. In this instance, Fitch has determined a low degree of correlation between the UMMS and TD Bank which results in the rating of 'AA+' on bonds. If either UMMS or TD Bank is downgraded to 'A-' or lower, the dual-party pay methodology could no longer be applied and the long-term rating for the individual series of bonds would then reflect the higher of the two ratings.

TD Bank will be obligated to make payments of principal and interest when due, as well as purchase price for tendered bonds. The rating on the bonds will expire on the earliest of: the Oct. 22, 2012 stated expiration date of the LOC, unless otherwise extended; any prior termination of the LOC; or defeasance of the bonds. The TD Bank LOC will provide full coverage of principal plus an amount equal to 35 days of interest at a maximum rate of 10% based on a year of 365 days. In addition, concurrently with the substitution of the LOC, TD Securities (USA) LLC replaces SunTrust Robinson Humphrey, Inc. as remarketing agent for the bonds.

Proceeds of the bonds were used to refund certain Maryland Health and Higher Educational Facilities Authority revenue bonds previously issued for the benefit of UMMS.