Children's Trust

Credit Ratings

Security

The Tobacco Settlement Asset-Backed Bonds Series are issued by the Children's Trust pursuant to the Children's Trust Act, by which the Commonwealth transferred to the Trust all of its right, title and interest under the Master Settlement Agreement (the ''MSA'') that was entered into by participating cigarette manufacturers (PM), Puerto Rico, 46 states and five other U.S. jurisdictions in November 1998 in the settlement of certain smoking-related litigation including the Commonwealth's right to receive certain initial, annual and strategic contribution payments to be made by the PMs under the MSA.

Functions

The Children's Trust is a GDB affiliate specially created pursuant to Act 173 of July 30, 1999, as amended (the Children's Trust Act) to administer the funds received by the Commonwealth of Puerto Rico from the settlement of claims against tobacco companies and use them to fund special programs to improve the quality of life of Puerto Rican families. The Children's Trust Fund has an assigned board of directors and the Bank is in charge of providing all of the Trust Fund's staff while serving as its disbursement agent and financial advisor.

Trustees Under the Different Trust Indentures:
Deutsche Bank

Financial Statements Audited by:
RSM Roc & Company