Fitch Affirms Eaton Vance Floating-Rate Income Trust Preferred Shares at 'AA'

Fitch Ratings has affirmed the 'AA' rating on the following Variable-Rate Term Preferred Shares (VRTP Shares) issued by Eaton Vance Floating-Rate Income Trust (NYSE: EFT), a closed-end fund advised by Eaton Vance Management (Advisor):

--$80,000,000 of Series C-1 VRTP Shares, due Dec. 18, 2015.

KEY RATING DRIVERS

--Structural provisions of the VRTP Shares including the Asset Coverage and Effective Leverage Ratio tests requiring the fund to maintain minimum levels of asset coverage;

--Sufficient asset coverage provided to the VRTP Shares as calculated per the fund's over-collateralization (OC) tests;

--Results of Fitch-performed stress tests meant to compare the fund's minimum asset coverage tests to the stresses outlined in Fitch's CEF criteria under changes to leverage amount and portfolio composition;

--Legal and regulatory parameters that govern the fund's operations; and

--The capabilities of Eaton Vance as investment manager.

ASSET COVERAGE

At the end of November, the fund's asset coverage ratio for the VRTP Shares, as calculated in accordance with the Investment Company Act of 1940 (1940 Act), exceeded 225%, which is the minimum asset coverage required by transactional documents. Furthermore, the fund's pro forma effective leverage ratio was below the 45% maximum leverage ratio allowed by the fund's governing documents.

Should the asset coverage tests for the VRTP Shares decline below their minimum threshold amounts and are not cured in a pre-specified timeframe, the transactional documents require the fund to reposition portfolio assets or reduce leverage in a sufficient amount to restore compliance with the applicable test.

STRESS TESTS

Fitch performed various stress tests on the fund to assess the strength of the structural protections of the VRTP shares. The fund's asset coverage and effective leverage tests were compared to the rating stresses outlined in Fitch's closed-end fund rating criteria. These tests included determining various 'worst case' scenarios where the fund's leverage and portfolio composition migrated to the outer limits of the fund's operating and investment guidelines.

For example, current portfolio composition was stressed by increasing the fund's issuer concentration, while simultaneously migrating the portfolio to increased 2nd lien or covenant-lite loans. The results of the stress tests indicate the structural protections of the VRTP Shares are in line with Fitch's rating criteria at an 'AA' rating level. In certain remote circumstances the asset coverage available to the VRTP shares fell below the 'AA' threshold, but in any case did not fall below 'BBB'.

FUND PROFILE

EFT is a diversified, closed-end management investment company registered under the Investment Company Act of 1940, as amended and commenced operations in June 2004. The fund has the investment objective of providing a high level of current income, with a secondary objective of seeking capital preservation to the extent consistent with its primary goal of high current income. Under normal market conditions, the fund will invest at least 80% of assets in senior loans. The fund may also invest in second-lien loans and high-yield bonds.

As of Nov. 30, 2013, the fund managed over $1 billion in assets, with approximately 85% in first lien senior bank loans and 8% in high yield corporate bonds with the remainder invested in second lied loans, equities and cash. The fund is currently well diversified by obligor with all exposures under 1.5%. The fund's top sector concentrations were in the Fitch sector categories of computer, electronics and telecommunications; broadcasting, media and cable; and healthcare - all exposures were under 20%.

As of the same date, the fund's total leverage, including the VRTP Shares, was approximately $380 million with a leverage ratio of 37%. In addition to the VRTP Shares, the fund continues to utilize senior debt financing in the form of a committed credit facility. The credit facility is secured by a general senior first claim on the fund's assets. The VRTP shares will be subordinate to the line of credit and senior to the fund's outstanding common shares.

The fund may purchase senior loans that are fully or partially unfunded and the commitments of which the fund is obligated to fulfill at the borrower's discretion. Fitch reviewed the size of the fund's unfunded loan commitments and found them to be less than 1% of total assets. The fund also invests in foreign currency denominated securities. The fund currently utilizes forward foreign currency exchange contracts to hedge the potential exchange rate risk associated with such investments.

THE ADVISOR

Eaton Vance Management, a subsidiary of Eaton Vance Corp., acts as the investment adviser to the fund. As of Sept. 30, 2013 Eaton Vance Corp. and affiliates managed approximately $273.1 billion in assets.

RATINGS SENSITIVITY

The ratings may be sensitive to material changes in the credit quality or market risk profile of the fund or the diversification of the portfolio by issuer or sector. Material changes to the terms and provisions of leverage senior to the VRTP Shares or changes to the derivative strategy and usage may also impact the rating assigned to the VRTP Shares. A material adverse deviation from Fitch guidelines for any key rating driver could cause the ratings to be lowered by Fitch.

For additional information about Fitch closed-end fund ratings guidelines, please review the criteria referenced below, which can be found on Fitch's website.

To receive Fitch's forthcoming research on closed-end funds please go to:

http://forms.fitchratings.com/forms/FAMCEFOptinform

Additional information is available at 'www.fitchratings.com'.

The sources of information used to assess this rating were the public domain and Eaton Vance.

Applicable Criteria and Related Research:

--'Rating Closed-End Fund Debt and Preferred Stock' (Aug. 14, 2013).

Applicable Criteria and Related Research:

Rating Closed-End Fund Debt and Preferred Stock

http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=716220

Additional Disclosure

Solicitation Status

http://www.fitchratings.com/gws/en/disclosure/solicitation?pr_id=812128

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