Story and photo by Hal Goodtree.
Cary, NC – Fitch Ratings has announced that it will confirm Cary’s top rating for $47 million in general obligation bonds on May 20.
What’s in a Rating?
Fitch, founded in 1913, is a worldwide leader in independent financial ratings and statistical analysis. In 1924, they introduced the now familiar “AAA” to “D” ratings scale. The company’s ratings scale, along with in-depth analysis by a staff of investment experts, quickly became the benchmark by which the financial community based fixed-income investment decisions.
For borrowers (like the Town of Cary), a better rating means lowers interest costs.
In a nutshell, towns like Cary get a good rating for having their financial house in order.
According to StockHouse.com, Fitch will confirm the triple A / F1+ rating for Cary in connection with a change from Bank of New York to JPMorgan Chase.
The AAA rating is well-known, but not the F1+. That’s the top rating for national short term credit. From Fitch:
Indicates the strongest capacity for timely payment of financial commitments relative to other issuers or obligations in the same country. Under the agency’s National Rating scale, this rating is assigned to the lowest default risk relative to others in the same country. Where the liquidity profile is particularly strong, a “+” is added to the assigned rating.
In tough economic times, this is good news for Cary taxpayers, business, real estate and economic development. It’s also good to hear that independent ratings agencies continue to validate the direction of Town Council policy and ToC staff work.
“We appreciate Fitch’s ongoing trust in the Town of Cary’s financial management. The short term rating confirmation on our variable rate debt will help the Town continue to enjoy record low interest rates which are ultimately a savings for our citizens.” – Karen Mills, CPA, Finance Director, Town of Cary