USVI still in 'Extremely Weak Economic, Financial and Liquidity Condition,' due to GERS

[TexasTowelie]

USVI STILL IN ‘EXTREMELY WEAK ECONOMIC, FINANCIAL AND LIQUIDITY CONDITION,’ RATINGS FIRM MOODY’S SAYS, WARNS PENDING COLLAPSE OF GERS A MAJOR CONCERN


Governor Kenneth Mapp had severed ties with the U.S. ratings agencies following multiple negative reviews of the territory’s bonds. But Governor Albert Bryan, who has said the former governor’s decision was harmful to the territory, has been working to rekindle the relationships, with Moody’s being one of the first of the top three to review the territory’s bonds since Mr. Bryan took office.

Moody’s Investors Service said it recently completed a periodic review of the U.S. Virgin Islands’ Caa3 issuer rating and the ratings of its four liens of matching fund revenue bonds, and concluded, for the moment pending a complete assessment, “direction uncertain.”

Moody’s said the Caa3 rating reflects the territory’s extremely weak economic, financial and liquidity condition, which has been made worse by the effects of Hurricanes Irma and Maria. The ratings firm said that while assistance from the federal government in response to the hurricanes has provided some near-term relief, “we believe the severity of the territory’s fundamental fiscal and cash challenges, combined with the pending insolvency of the territory’s Government Employees’ Retirement System, make a debt restructuring highly likely.”

Moody’s said the latest, periodic review also covered related credits within the territory’s debt stack including any special tax, lease, appropriation and moral obligation, intercept program, and pool program ratings.

Read more: https://viconsortium.com/breaking-news/usvi-still-in-extremely-weak-economic-financial-and-liquidity-condition-ratings-firm-moodys-says-warns-pending-collapse-of-gers-a-major-concern/