Morningstar DBRS Confirms First Nations Finance Authority's Commercial Paper Rating at R-1 (middle), Stable Trend Following Limit Increase

DBRS Limited (Morningstar DBRS) confirmed the First Nations Finance Authority's (FNFA) Commercial Paper (CP) rating at R-1 (middle) with a Stable trend. FNFA has increased the maximum aggregate principal amount available under its CP Program to $600 million from $400 million.

Morningstar DBRS understands that net proceeds drawn under the CP Program will continue to be used to fund the bridge financing program prior to loans being financed by long-term fixed-rate debentures. The program size is being increased in response to increased loan demand from approved borrowing members (First Nations and other organizations serving Indigenous people).

Based on its review, Morningstar DBRS is satisfied that FNFA's revised CP Program limit and the credit facility continue to meet Morningstar DBRS' requirements with respect to CP programs as outlined in the "Morningstar DBRS Global Corporate Criteria." The CP Program is backstopped by a secured credit facility with a syndicate of seven chartered banks and provides for same-day availability in the event that it is required to repay CP. FNFA has increased the maximum size of its committed bank facilities to $600 million from $400 million.

ENVIRONMENTAL, SOCIAL, AND GOVERNANCE CONSIDERATIONS
There were no Environmental/Social/Governance factors that had a significant or relevant effect on the credit analysis.

A description of how Morningstar DBRS considers ESG factors within the Morningstar DBRS analytical framework can be found in the Morningstar DBRS Criteria: Approach to Environmental, Social, and Governance Risk Factors in Credit Ratings (January 23, 2024) at https://dbrs.morningstar.com/research/427030.

Notes:
All figures are in Canadian dollars unless otherwise noted.

Morningstar DBRS applied the following principal methodology:
-- Rating Canadian Municipal Governments (Appendix 3: Canadian Government Pooled Lending Vehicles) (April 15, 2024), https://dbrs.morningstar.com/research/431207

Morningstar DBRS credit ratings may use of one or more sections of the Morningstar DBRS Global Corporate Criteria (April 15, 2024), https://dbrs.morningstar.com/research/431186, which covers, for example, topics such as holding companies and parent/subsidiary relationships, guarantees, recovery, and common adjustments to financial ratios.

The following methodology has also been applied:
-- Morningstar DBRS Criteria: Approach to Environmental, Social, and Governance Risk Factors in Credit Ratings (January 23, 2024), https://dbrs.morningstar.com/research/427030

The credit rating methodologies used in the analysis of this transaction can be found at: https://dbrs.morningstar.com/about/methodologies.

A description of how Morningstar DBRS analyzes corporate finance transactions and how the methodologies are collectively applied can be found at: https://dbrs.morningstar.com/research/397223.

The related regulatory disclosures pursuant to the National Instrument 25-101 Designated Rating Organizations are hereby incorporated by reference and can be found by clicking on the link under Related Documents or by contacting us at info-DBRS@morningstar.com.

The credit rating was initiated at the request of the rated entity.

The rated entity or its related entities did participate in the credit rating process for this credit rating action.

Morningstar DBRS had access to the accounts, management, and other relevant internal documents of the rated entity or its related entities in connection with this credit rating action.

This is a solicited credit rating.

The conditions that lead to the assignment of a Negative or Positive trend are generally resolved within a 12-month period. Morningstar DBRS trends and credit ratings are under regular surveillance.

Information regarding Morningstar DBRS credit ratings, including definitions, policies, and methodologies, is available on dbrs.morningstar.com or contact us at info-DBRS@morningstar.com.

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