Stable Credit Rating Maintained By Council
International credit rating agency Standard & Poor’s (S&P) has kept Hamilton City Council’s positive credit rating as AA-.
Year on year, Council has maintained this rating, indicating the organisation is in a ‘very strong’ position to meet its financial commitments.
For new significant infrastructure or unplanned events, Council may need to borrow money to cover the costs – Council’s AA- rating gives assurance to lenders that any debt carried comes with a very low credit risk and strong capacity to repay.
The score also gives Council access to lower interest rates on its borrowing through the Local Government Funding Agency.
The rating is testament to excellent long-term city planning and financial management, said Council’s Finance Committee Chair, Councillor Rob Pascoe.
“It’s a big accomplishment given the unprecedented growth and demand on existing infrastructure and services, and the impact of COVID-19,” he said. “Keeping this rating shows we have the financial stability, and gives us confidence, to keep investing in and growing our city’s assets.”
Credit scores are independently managed to assess an organisation’s capacity to manage debt.
S&P is one of three global credit agencies which provide ratings based on a broad range of factors including finance, repayments, business history and the economic market.
As well as reflecting positively on Council’s financial management and planning, S&P’s rating remains optimistic about the local economy.
“Hamilton's economy has recovered from the COVID-19 pandemic, supported by a diverse range of industries as well as being the nation's third-fastest-growing urban area behind Auckland and its surroundings,” the report said. “[Hamilton’s] economic growth has risen 7.3% in the 12 months to June 2021, demonstrating a post-lockdown boom. We believe ongoing large greenfield projects such as Peacocke and Rotokauri will contribute to the economy's recovery and add about 20,000 homes in the coming decade to meet residential housing demand.”