Fitch affirms the rating assigned to the auction market preferred stock ('AMPS') series M7, T7, W7, TH7, F7, T28 and W28 issued by Flaherty & Crumrine/Claymore Preferred Securities Income Fund (the 'Fund') in the total amount of $165,000,000 at 'AAA'. The rating affirmation follows redemption of certain shares of the above mentioned series in the total amount of $377,000,000 or about 70% of the total amount of AMPS outstanding. The 'AAA' rating denotes expectations of very low credit risk.
The Fund intends to change its primary method of leverage from AMPS to a combination of debt and AMPS. A proportionate amount of each series of the Fund's AMPS is expected to be redeemed at the next dividend payable date on or after May 21, 2008.
Flaherty & Crumrine/Claymore Preferred Securities Income Fund is a diversified, closed-end management investment company organized under the laws of the State of Maryland on May 23, 2002, whose common shares are traded on the NYSE under the symbol 'FFC'. As of March 31, 2008, the Fund had approximately $1.36 billion in assets under management.
The Fund's investment objective is to provide high current income for holders of its common stock consistent with preservation of capital. The Fund will normally invest at least 80% of its total assets in a diversified portfolio of preferred securities. Under current market conditions, the Fund expects that its portfolio of preferred securities will consist principally of 'hybrid' or taxable preferreds. The Fund may also invest up to 20% of its total assets in debt securities and up to 15% of its total assets in common stocks.
The affirmed rating is based on the strength of the Fund's underlying portfolio that provides preferred stock liquidation coverage as well as the quality and experience of the Fund's investment manager. At the time of the rating affirmation, the Fund's pro-forma AMPS coverage ratios that take the above named redemption into effect, calculated in accordance with the requirements of the 1940 Act as amended and the Fitch coverage ratio satisfied regulatory requirements mandating an asset coverage ratio of at least 200% as well as Fitch's minimum coverage ratio requirements of at least 100%.
The Fund is managed by Flaherty & Crumrine Inc. Flaherty & Crumrine and its affiliates had approximately $3.3 billion in assets under management as of March 31, 2008.
Fitch's rating definitions and the terms of use of such ratings are available on the agency's public site, www.fitchratings.com. Published ratings, criteria and methodologies are available from this site, at all times. Fitch's code of conduct, confidentiality, conflicts of interest, affiliate firewall, compliance and other relevant policies and procedures are also available from the 'Code of Conduct' section of this site.
Contacts:
Viktoria Baklanova, CFA, 212-908-9162
Yuriy
Layvand, CPA, 212-908-9191
or
Media Relations:
Kenneth
Reed, 212-908-0540
