Georgia Fund 1 Prime rating affirmed by Fitch

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Georgia Fund 1 rating affirmed

Highlights

Fitch affirms Georgia Fund 1 Prime's 'AAAmmf' rating after reviewing end-2026 portfolio holdings, citing strong investment guidelines, liquidity, and management.
The fund's portfolio credit factor is 1.25, below Fitch's 1.50 ceiling, with weighted average maturity at 50 days and weighted average life at 80 days.
As of review, liquidity ratios exceed Fitch's standards with 22% daily and 34% weekly liquid assets, and Federated Hermes manages $884 billion in assets as of June 30, 2026.

Rating review and portfolio metrics

As reported by Fitch Ratings, the agency affirms Georgia Fund 1 Prime at 'AAAmmf' after reviewing the fund's governing documents, investment guidelines and portfolio holdings as of the end of 2026. The fund is managed by Federated Investment Counseling, a wholly owned subsidiary of Federated Hermes, Inc.

Fitch says the rating reflects the fund's investment guidelines, credit quality, diversification, duration limits and liquidity profile, along with the manager's ability to oversee the assets. Under Fitch's criteria, a 'AAAmmf' rating signals an extremely strong capacity to preserve principal and provide liquidity while limiting credit, market and liquidity risk.

The agency says the fund's portfolio credit factor stands at 1.25 on the review date, below the 1.50 ceiling required for a 'AAAmmf' rating. Fitch adds that any periodic portfolio credit factor readings above 1.50 since its last review are temporary or sufficiently mitigated.

The fund also remains within Fitch's maturity parameters, with weighted average maturity at 50 days and weighted average life at 80 days, both below the respective limits of 60 days and 120 days. Fitch says the pool invests exclusively in short-term securities rated at least 'F1' or the equivalent.

Liquidity profile and manager support

The local government investment pool operates in a manner similar to a money market fund and seeks to limit exposure to individual issuers to 10% or less of net asset value, with tighter conditions for holdings above seven days in tenor. Fitch says minor and temporary deviations may occur from time to time, mainly because of cash outflows.

Fitch also outlines limits for repurchase agreement counterparties, including a 25% of net asset value cap for counterparties rated 'F1' or higher when repos are fully collateralized by high-credit-quality and liquid government securities. For counterparties rated 'F2', exposure is limited to 10% of net asset value when the repo is backed by high-quality government securities and matures within one week or less.

On liquidity, the fund seeks to keep at least 10% of total assets in daily liquid securities and at least 30% in weekly liquid securities, in line with Fitch's rating criteria for 'AAAmmf' local government investment pools. As of the review date, weekly liquid assets are 34% and daily liquid assets are 22%.

Fitch says its money market fund criteria also consider shareholder diversification, the manager's distribution platform and investor-related risk controls. The agency receives portfolio holdings data every two weeks for surveillance, and it views Federated's capabilities, governance, compliance procedures and operational resources as consistent with the assigned rating. As of June 30, 2026, Federated Hermes reports $884 billion in assets under management.

Earlier, we reported on Hainan Rubber securities and how Fitch rated the proposed subordinated perpetual notes BBB-.

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