Aberdeen City Council maintains credit rating after annual assessment
Aberdeen City Council has been recognised for “a strong institutional framework” and “strong track record of operating performance” by credit rating agency Moody’s, which has completed its annual assessment of the organisation.
The credit rating review follows the initial awarding of a credit rating last year in advance of the successful £370million bond issue on the London Stock Exchange.
Aberdeen City Council’s rating was adjusted to Aa3 with a stable outlook, from Aa3 with a negative outlook, in line with a downgrading of UK sovereign rating in September.
In October Moody’s visited the city as part of its comprehensive annual review and this month confirmed it was maintaining the Aa3 rating and stable outlook.
In its report, the independent ratings agency noted the strong institutional framework and track record of operating performance as well as the region’s wealthy economy. During their visit, Moody’s representatives toured the site of the new Aberdeen Exhibition and Conference centre, representing the Council’s largest ongoing capital project, as well as meeting representatives of the Oil & Gas Technology Centre – launched following the signing of the City Region Deal in 2016.
Cllr Douglas Lumsden, Aberdeen City Council Co-Leader and convener of the Finance, Policy and Resources committee, said: “The independent view of Moody’s is very welcome as it underlines the prudent financial management at the heart of Aberdeen City Council’s operations.
“As a result of the bond issue and initial credit rating, we now face more stringent financial scrutiny than any local authority in Scotland and the process provides additional assurance to elected members and the wider public.“
During the Aberdeen visit the Moody’s representatives were updated on the Council’s 2016/17 reported financial position as well as the estimated 2017/18 position, projected medium term financial position, treasury and debt management position as well as being provided with an overview of the local economy.
The annual credit rating review was part of the agenda for Friday's (December 1) meeting of the Finance, Policy and Resources committee. The latest quarterly financial report was also considered by members.
Figures for the second quarter (July-September 2017) show a projected General Fund revenue overspend of £1.1m for the 2017/18 year (0.3% of net cost of services). The report to committee states this is the result of a number of cost pressures which will be mitigated during the remainder of the financial year through effective management of costs.
The Finance, Policy and Resources committee will reconvene on Wednesday (December 6) at 1pm to consider the remainder of the agenda.