Standard & Poors affirms Auckland Council “AA” credit rating
20 February 2012
Auckland Council “AA” credit rating affirmed by Standard and Poors
Auckland Council is pleased that credit rating agency, Standard and Poor’s, has affirmed its long-term rating at AA stable today, after reviewing its draft Long Term Plan financial projections.
The rating agency’s action reflects Auckland Council’s prudent financial strategy, which emphasises strong financial management, a balanced budget, and efficient, diversified funding sources. These balance the impact of proposed investments to improve the region and its infrastructure, which it plans to fund through debt.
Both the Mayor and the Chair of the Council's Strategy and Finance Committee have welcomed the news.
"Auckland Council has carefully balanced the need for keeping debt levels as low as possible while dealing with the investment required to cope with the growth being experienced as Auckland becomes a truly international city," says Mayor Len Brown.
"The announcement is an endorsement of the fiscal responsibility being shown by Auckland Council," says Councillor Penny Webster. "Retaining our credit rating as before is positive news amidst a global environment of uncertainty with most organisations facing rating downgrades.”
Standards and Poor’s note in their report the strong financial management, the supportive institutional framework of Auckland Council and the important role the Auckland region plays in New Zealand’s economy as the country’s financial and economic hub.
Auckland Council remains one of New Zealand’s highest-rated local entities; its AA rating is above that of the major domestic banks and similar to other rated local government bodies. The rating is one notch below the government’s domestic credit rating of “AA+” and on par with its foreign currency credit rating of “AA”.
AA is the third-highest credit rating on the Standard and Poor’s credit rating scale.
Auckland Council is undergoing its own review of its funding arrangements and will undertake full public consultation on its draft Long-term Plan including various the sources of funding for the wide range of projects within the plan.