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Moody’s Releases Public Issuer Rating for State of South Dakota





            Office of Gov. Dennis Daugaard

500 E. Capitol Ave.

Pierre, S.D. 57501

(605) 773-3212

www.sd.gov

 

 

 

 

FOR IMMEDIATE RELEASE:  Monday, July 11, 2016

CONTACT:  Tony Venhuizen or Kelsey Pritchard at 605-773-3212

 

 

Moody’s Releases Public Issuer Rating for State of South Dakota

 

PIERRE, S.D. – Gov. Dennis Daugaard announced today that Moody’s has released a public issuer rating of AAA for the State of South Dakota. This follows an upgrade from February in the state’s bonds issued through the South Dakota Building Authority and Vocational Education program within the South Dakota Health Education Facilities Authority to Aa1, an improvement over the previous rate of Aa2.

 

“Securing this public issuer rating was the last step in our quest to attain AAA from the three major rating agencies," said Governor Daugaard. “We knew that we were rated at the highest level Moody’s could rate our bonds, however the public issuer rating was not formalized until now.”

 

Due to the constitutional prohibition on debt, South Dakota bonds are issued through authorities, secured by lease-appropriations made by the state Legislature. As a result, all bonds are rated one notch below the rating of the state. However, until now, South Dakota did not have an issuer rating despite the state’s bonds being rated by Moody’s as Aa1.

 

South Dakota does have a public issuer rating from S&P and Fitch, and both rate South Dakota at AAA. This issuer rating marks the last major rating agency to rate the State of South Dakota as AAA.

 

In their release of the rating, Moody’s attributed the rating to South Dakota’s “high levels of reserves, low fixed costs, stable revenues and an economy that has historically been more stable than the rest of the nation.”

 

Credit ratings give potential bond purchasers a measurement of state performance and credit worthiness. Upgrades typically allow issued bonds to carry a lower interest rate, providing interest savings to issuers like the Building Authority. 

 

“Upgrades signify the financial strength of a state,” Gov. Daugaard said. “Now it is clear we have the best ratings possible and that high distinction will help economic development efforts in South Dakota.”

 

Click here to read Moody’s credit opinion for South Dakota.

                                                               

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