The City of Cape Town is proud to announce that it has sustained its national scale rating from the credit agency Moody’s, at Aaa. This means that the City has again demonstrated the strongest creditworthiness relative to other South African cities. Read more below:
Moody’s has issued its final credit opinion on the City, with a rating of Aaa. Good opinions are crucial for prudent financial planning as the better the rating, the lower the interest charged on debt.
‘On 28 November 2017, Moody’s Investors Service placed the long-term global scale ratings of 12 South African regional and local governments and three government-related entities under review for downgrade, including City of Cape Town’s. Our sustained Aaa National Scale Rating is a remarkable achievement given the drought that has led to unprecedented expenses for the City.
‘Moody’s notes that the City’s financial position is supported by the administration’s prudent financial policies and its relatively large and diversified economic base. These good opinions do not happen on their own. This is as a result of a lot of hard work by our dedicated City officials and financial teams. Good governance and sound financial management are incredibly important, especially during a time of crisis,’ said the City’s Mayoral Committee Member for Finance, Councillor Johan van der Merwe.
As in previous financial years, the City received an unqualified audit report for the financial year ending 30 June 2016.
As per the Moody’s opinion, this rating reflects the City’s ‘consistently robust budgetary performance, strong liquidity position and debt levels that are lower than the median of other metropolitan cities’, albeit expected to moderately increase in the medium-term.