WCC's credit rating higher than crown's

23 November 2015

Wellington City Council has maintained its Standard and Poor’s (S&P) AA credit rating and, for a second year in a row, the rating service considers the Council’s credit rating to be higher than that of the Crown’s.

“We view Wellington City’s stand-alone credit profile to be higher than the New Zealand sovereign, but have capped the ratings at the sovereign level.”

“The ratings reflect our views of the council’s very strong financial management and budgetary flexibility, strong liquidity, and low contingent liabilities.

“Wellington City’s key credit strength is anchored in its very strong financial management.

“The stable outlook reflects our view that the stand-alone credit quality of Wellington City will remain very strong over the next two years, and our expectation that the council will continue to manage its financial position prudently.”

Deputy-Mayor Justin Lester, the Chair of the Council’s Governance, Finance and Planning Committee, says he congratulates Council Chief Executive Kevin Lavery, his senior managers and financial team for the rating report.

“I want to acknowledge the very steady and capable hands managing Council finances that, again, give the Council a stable outlook,” says Cr Lester.

Wellington Mayor, Celia Wade-Brown, says maintaining a strong credit rating allows the Council to borrow at low interest rates saving substantial amounts of money.

“Council is playing a stronger economic development role with bold initiatives requiring significant spending – like contributing to Wellington Airport’s runway extension and a new film museum. I am pleased Standard and Poor’s acknowledge our robust financial position, which allows us to continue investing in the city’s future.”

Councillor Mark Peck, the Chair of the Council’s Audit and Risk Sub-committee, says he is pleased that the report highlighted the ‘extensive and credible management framework’ the council uses to manage both external and internal risks.

As well as maintaining its AA long-term credit rating, Wellington City Council also has kept an A-1+ short-term issuer credit rating.