Recent Auction and Refinancing of USM Bonds Will Benefit Taxpayers and Generate Millions Toward New Facilities Projects

System Continues to Hold Strong Financial Ratings in Higher Education Sector Nationally

Baltimore, Md. (Feb. 15, 2022) – Maryland taxpayers will greatly benefit from the University System of Maryland’s (USM) recent auction of Series A bonds, coupled with a successful refinancing of previously issued public bonds.

On Feb. 10, the USM sold a set of new Series A bonds carrying a face value of nearly $102.9 million and a 2.36% interest rate. The winning bid at the auction was $115.6 million, nearly $12.7 million over the bonds’ face value—a recognition of USM bonds as a highly attractive investment, given the system’s financial strength and prudent financial management. The USM plans to dedicate the premium to ongoing and future spending on capital projects approved by the USM Board of Regents.

In a separate transaction, the USM also closed on the refinancing of $23.9 million of Series B bonds issued in 2012. The winning bid for this refinance was $2.4 million over the bonds’ face value at a new interest rate of 1.13%.  The premium generated by the refinance—along with the more than $550,000 in interest savings over the next four years—will lower debt service payments for USM institutions.

Solid Bond Ratings Continue

Earlier this month, the system received a rating of Aa1 from Moody’s Investor Services and ratings of AA+ from Standard and Poor’s and Fitch Investor Services.

All three ratings agencies have again reaffirmed the USM financial outlook as “stable,” an especially impressive determination at a time the broader higher education sector is experiencing a negative outlook.

Each rating was only one level down from the highest possible grade of AAA -- a level typically reached only by government entities with the authority to collect tax revenue.

When the nation’s three primary bond-rating agencies issue such strong ratings for a statewide university system, they offer the most official recognition of the USM’s financial strength and stability.

The USM has demonstrated consistently high bond ratings for more than a decade. The USM Aa1 rating with Moody’s has held constant since September 2010, and the system received its AA+ rating from Fitch in December 2010 and has maintained that rating since. The USM has earned the same AA+ rating with Standard and Poor’s since 2008.

Strong bond ratings translate into practical financial advantages for the USM, its students and Maryland taxpayers. With strong ratings, the USM can borrow money and refinance debt at lower interest rates, and the system can leverage the best partnership opportunities in future financial transactions.

“I’m so happy with these results, especially since they reflect the consistently sound financial management of our institutions,” said USM Chancellor Jay A. Perman. “Our strong credit ratings speak to the leadership of many people—our presidents and their financial officers, our financial affairs staff in the USM Office, and, of course, the members of our governing board. In meetings with the credit rating agencies, I told the analysts I’m bullish on higher education. And I’m certainly bullish on the University System.”

Ellen Herbst, USM’s vice chancellor for finance and administration, said it is especially gratifying for the system to receive such strong endorsements of its financial position considering all the challenges the COVID-19 pandemic has posed to higher education during the past two years.

 “These results demonstrate the first-rate direction our presidents and system leadership provide every day in making decisions that result in strong, sustainable outcomes,” Herbst said.

The USM comprises 12 institutions: Bowie State University; Coppin State University; Frostburg State University; Salisbury University; Towson University; the University of Baltimore; the University of Maryland, Baltimore; the University of Maryland, Baltimore County; the University of Maryland Center for Environmental Science; the University of Maryland, College Park; the University of Maryland Eastern Shore; and the University of Maryland Global Campus. The USM also includes three regional centers—the Universities at Shady Grove, the University System of Maryland at Hagerstown, and the University System of Maryland at Southern Maryland—at which USM universities offer upper-division undergraduate and graduate courses.

Systemwide, student enrollment is roughly 165,000. The USM and its institutions compete successfully for nearly $1.5 billion in external grants and contracts annually. USM institutions and programs are among the nation's best in quality and value according to several national rankings. To learn more about the University System of Maryland, visit


Contact: Mike Lurie
Phone: 301.445.2719