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MassDevelopment In The News
S&P Ups MassDevelopment
July 2, 2007: The Bond Buyer, by Michelle Kaske
Standard & Poor’s upgraded the Massachusetts Development Finance Agency’s long-term rating to A-plus from A.
Fitch Ratings and Moody’s Investors Service do not rate MassDevelopment.
The authority is a conduit issuer, and while the credit change does not directly affect outstanding debt, the upgrade strengthens MassDevelopment’s financial standing if the authority were to ever sell debt on its own, according to MassDevelopment’s chief financial officer, John Champion.
"If there’s additional utilities infrastructure required to bring in new businesses to the commonwealth, it may require some bond financing, and we’re in a good position because this enhances our ability to deliver on those," Champion said.
While the agency does not have outstanding debt that it is directly liable for, its subsidiary, the Saltonstall Building Redevelopment Corp., has $195 million of debt outstanding. Those bonds were sold in 2002.
Standard & Poor’s connects MassDevelopment’s rating closely to the state, rated AA, due to the state’s close financial ties with the authority. The state also carries Aa2 and AA ratings from Moody’s and Fitch, respectively.
"We categorize MassDevelopment as a public policy-based institution because its primary business is the development and execution of key economic objectives of the state," Standard & Poor’s analyst Jeffrey Zaun said in a press release.
In 2006, the authority was the second largest issuer in the state behind the state itself, selling $1.1 billion of debt in 36 different issues, according to Thomson Financial.
© Copyright 2007 The Bond Buyer.
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