University System of Maryland Maintains Strong Debt Ratings as USM Issues New Bonds
Adelphi, Md. (Feb. 14, 2018) – The University System of Maryland (USM) continues to maintain high ratings for credit worthiness from the nation’s three principal bonds ratings agencies--Standard & Poor's, Moody's, and Fitch.
The USM recently completed the sale of $115 million in 2018 Series A revenue bonds. By maintaining its strong ratings in the course of this bond sale, the USM is able to borrow money for campus building projects at a lower cost. As a result, the USM saves millions of dollars that can help the system improve its overall budget picture and keep tuition lower.
The strong ratings for this latest bond issue allow the system to fund important facilities needs at the lowest possible interest cost.
“The accompanying ratings reports from the agencies noted several key elements supporting the favorable ratings,” said USM Chancellor Robert L. Caret.
“These elements include USM’s positive operating performance, strong state support, good revenue diversity, conservative debt structure, strong fund balance, and solid management oversight.”
For this series of bonds, USM has received high ratings of AA+ from Fitch Ratings, Aa1 from Moody's Investor Services, and AA+ from Standard & Poor's. All three ratings services give USM an outlook of "stable.”
Such strong evaluations are significant because they reflect positively on the USM’s sound financial stewardship. The strong ratings are especially impressive in the context of a broader economic climate nationally that has challenged colleges and universities in recent years.
The USM benefits from an effective partnership with the administration of Gov. Larry Hogan and the Maryland General Assembly.
The state's support of the USM's mission as a system of public higher education has resulted in affordable tuition, support of key initiatives, and construction of important capital improvement projects on campuses to support current students and attract prospective students.
A team of executives from USM’s Department of Finance and Administration, headed by recently appointed Vice Chancellor Ellen Herbst and a leadership team in the USM controller’s office that includes Bob Page, Celeste Denson, and Samantha Norris, prepares extensively to demonstrate USM’s stable financial management in meetings with the bond ratings agencies in New York’s financial district.
The responsible management of financial resources helps the USM to pursue its core missions in teaching and research.
Contact: Mike Lurie