City of Peterborough Maintains AA+ Credit Rating
/Standard & Poor’s has maintained the City of Peterborough’s credit rating at “AA+” in its recently released credit report on the municipality, reported on Thursday.
Standard & Poor’s is a financial services company that offers services including credit ratings, data analysis and equity research to both the private and public sectors worldwide. File Photo.
The report cited the City’s ‘political and managerial commitment to disciplined fiscal policies’ as the reasoning for its rating.
‘AA+’ is the second highest rating on Standard & Poor’s credit rating scale.
Standard & Poor’s pointed to the strong support by the federal government and the Province for municipalities and the City’s financial management.
“The stable outlook reflects S&P Global Ratings' expectation that, in the next two years, Peterborough will sustain healthy operating surpluses. Although we expect temporarily higher after-capital deficits during this time as the city proceeds with its large capital plan, we expect they will stay below 5% of total revenues, on average, from 2021-2025. In addition, we expect increased additional borrowing to support the capital plan but that the city's tax-supported debt will remain below 65 per cent of operating revenue over the forecast horizon,” states Standard & Poor’s.
Among the observations for the City of Peterborough’s credit rating, Standard & Poor’s has cited:
The City's exceptional liquidity position and supportive institutional framework continue to bolster its credit profile
The City’s political and managerial commitment to disciplined fiscal policies
An extremely predictable and supportive local and regional government framework that has demonstrated high institutional stability and evidence of systemic extraordinary support in times of financial distress
Municipalities have demonstrated a track record of strong budget results with debt burdens, on average, low compared with those of global peers and growth over time has been modest
Projection that the City’s capital spending will increase in the next several years, with after-capital deficits widening to an average of 4.7 per cent of total revenues in 2021-2025
