A report stating that eThekwini Municipality has improved its credit rating outlook to positive was welcomed at a Full Council meeting on 26 August.

 

The review, conducted by the Global Credit Rating (GCR) Agency in July, reflects that the City has sustained low leverage, strong credit protection metrics and ample liquidity despite the turbulence of the past financial year and the current tough economic climate.

 

According to the report by GCR, this has been facilitated by a relatively strong operating performance which is expected to allow the Metro to quickly rebound from Covid-19 related disruptions.

 

The Municipality maintained AA+ status for their long-term which means that it is of a very high credit quality and protection factors are strong.

 

For short-term debt, the City maintained its A1+ status which means there is a very high certainty of timely payment, liquidity factors are excellent and are supported by good fundamental protection factors.

 

The municipality was upgraded from stable to positive outlook, which reflects eThekwini’s strong performance and robust financial profile through the rating cycle. Accordingly, GCR may raise the rating if service delivery and operating performance meaningfully improves post the Covid-19 disruptions. Debt and liquidity metrics remain robust.

 

Commenting on the review, newly appointed Chief Financial Officer Sandile Mnguni said considering the current economic climate, this rating was welcome news.

 

“We need to commend the City’s leadership and the commitment from councillors and employees. That the Municipality was awarded a positive outlook is testament to the financial stability and sustainability of the City,” he said.

 

ENDS

 

Issued by the eThekwini Municipality’s Communications Unit. For media enquiries contact the Municipality’s Spokesperson, Msawakhe Mayisela on 060 966 4220.