Invercargill City Council has had its AA+ with a stable outlook credit rating affirmed for the fifth year in a row.
International credit rating agency Fitch Ratings delivered its reassessment on Friday, saying its expectation was that Council maintains “a ‘High mid-range’ risk profile, given its autonomy on rates and ability to manage expenditure growth, despite rising inflation and interest rates”.
A corporate credit rating is an assessment of an entity’s ability to meet future financial commitments. The credit rating helps lenders determine the risks about an organisation’s capacity to manage debt, meaning it is less difficult for Council to borrow when it needs to.
The high mid-range risk profile reflects Fitch’s belief that there is a low risk that Council will be unable to cover its debt servicing needs in the medium term.
Council Group Manager Finance and Assurance Patricia Christie said she was pleased Council had been able to maintain the same rating for so long.
“The AA+ rating is confirmation that we are doing things right. I’m proud we have been able to maintain such a good rating despite the many challenges that have been thrown our way over the past five years.
“This rating also reaffirms to us that the flexibility and prudence in our financial management policies combined with our low debt levels, has provided a stable platform for the future.”