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VICTORIA
– Moody’s Investors Service has
improved British Columbia’s credit rating to Aaa, the highest possible rating,
Finance Minister Carole Taylor said today.
Moody’s,
one of the world’s leading credit rating agencies, boosted B.C.’s credit rating
to Aaa from Aa1, citing a “well-structured fiscal framework, leading to a
reduced debt burden” and the expectation of further improvements in debt ratios
over the medium term. This is the second upgrade from Moody’s in less than two
years.
“Reaching
triple-A status speaks to investors’ confidence in British Columbia’s economy
and the Province’s sound fiscal management,” said Taylor. “I want to recognize
the hard work of British Columbians, along with the leadership shown by the
Premier, cabinet and my treasury board colleagues, to turn around B.C.’s
economy and get our fiscal house in order. As Moody’s points out, it is the
regulatory reforms, the tax reductions, and our prudent forecasts and disciplined
approach that restored B.C.’s place as a leader in Canada.”
Currently,
only the Province of Alberta and the Government of Canada hold Aaa ratings
among Canada’s senior governments. British Columbia has not held an Aaa rating
from Moody’s since July 1983.
Moody’s
is one of several ratings agencies that regularly examine the financial health
of governments to determine risk associated with the issuance of government
bonds. Over the past couple of years, the Province has received five credit
rating upgrades from major bond rating agencies, including upgrades from
Standard and Poor’s and Dominion Bond Rating Service.
The
sustained improvements in credit rating saves taxpayers debt service costs and
allows for investment in other government priorities. In the fall of 2001, the
Province borrowed at interest rates that were nine basis points higher than the
Province of Ontario, the market benchmark among provincial issuers. Today,
British Columbia’s borrowing rate is four basis points lower than Ontario’s.
With each annual borrowing program, this improvement translates to interest
savings of about $50 million over a 10-year average term.
“Credit
rating improvements result in real savings that we can put to other priorities
such as health care or education,” said Taylor. “But we must continue with our
prudent and disciplined approach if we are to keep generating these kinds of
benefits for British Columbians.”
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contact: |
Communications Director Ministry of Finance 250 356-2821 |
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For more information on government services or to subscribe to the Province’s news feeds using RSS, visit the Province’s website at www.gov.bc.ca. |
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