Rating agency upgrades several Anchorage bond ratingsChange in rating likely to reduce the cost of Anchorage's debt
ANCHORAGE- Last week, a global rating agency upgraded several of the
Municipality of Anchorage's (MOA) bond ratings. Fitch Ratings (Fitch) provides
the world's credit markets with independent and prospective credit opinions,
research and data.
After a thorough review, Fitch announced that the MOA's General Obligation
bond rating would be recalibrated upward. Prior to the recalibration, the MOA
enjoyed an AA credit rating on its bonds. After the recalibration the MOA's credit
rating is AA+. The improvement in the rating is likely to have a positive effect on
the pricing of the Municipality of Anchorage's debt, particularly when issuing
Build America Bonds.
Fitch began the process of recalibrating certain U.S. public finance credit ratings
in July 2008. They said the intent of the recalibration was to ensure a greater
degree of comparability across Fitch's global portfolio of credit ratings. The credit
rating adjustments were made to denote a comparable level of credit risk
between public finance and other sectors of the market.
"We are pleased to have received a positive adjustment to our credit rating," said
Lucinda Mahoney, chief financial officer for the city. "This will likely have a
positive impact on the pricing of our debt in the taxable marketplace when selling
Build America Bonds, mostly because many of these investors have not
historically purchased our debt due to tax exempt nature of the bonds."
Additionally, Fitch made adjustments to the following credit ratings:
- AWWU, both the water utility and the wastewater utility, from AA- to AA
- CIVICVentures, from A to A+
Posted: May 13, 2010
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