Moody’s upgrades North Providence bond

Moody’s Investors Service last week upgraded the creditworthiness of a North Providence general obligation bond from A3 to A2, affecting $11 million.
Moody’s Investors Service last week upgraded the creditworthiness of a North Providence general obligation bond from A3 to A2, affecting $11 million.

NORTH PROVIDENCE – Moody’s Investors Service last week upgraded the creditworthiness of a North Providence general obligation bond from A3 to A2, affecting $11 million.
The credit rating agency says the upgrade, which reflects a low-risk, investment grade rating, comes from a “continued stabilization of the town’s financial position and expectation that this trend will continue,” according to the rating.
The upgrade affects rated debt for general obligation bonds, including a series 2013 issued through the R.I. Health and Educational Building Corp. and series 2007 general obligation bonds, according to the rating.
Moody’s does not typically assign an outlook to local government credit with this amount of debt outstanding.
The rating agency says sustained increase in reserves and liquidity, continued improvements to the overall pension funding levels – which are among the best in the state at the municipal level – and an increase in the size of wealth of the local economy could lead to another upgrade. An erosion of reserves, an unwillingness to fully fund pension payments and a material increase in debt leading to the loss of financial flexibility could lead to a downgrade, according to Moody’s.
The 2007 general obligation bonds are secured by an unlimited property tax pledge, and the 2013 bonds are also backed by taxpayers and secured through RIHBC.

No posts to display