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THEMARICOPAMOD.COM / BUSINESS

Queen Creek joins Phoenix as S&P credit rating score comes in

Bond ratings are assessments of the creditworthiness of a bond issuer.
PUBLISHED 4 DAYS AGO
The ratings are divided into two main categories: investment-grade bonds and non-investment-grade (junk) bonds.
The ratings are divided into two main categories: investment-grade bonds and non-investment-grade (junk) bonds.

Queen Creek, Arizona: Standard & Poor’s (S&P) Rating has completed an independent review of Queen Creek’s credit rating, giving it a AA+ rating with a stable outlook. This is the same rating given by S&P to Phoenix.

“This rating is really an indicator that the Town has been, and continues to be in a strong financial condition,” stated Queen Creek Mayor Julia Wheatley. “As a Council, we are committed to making financially sound decisions while also meeting the needs of a growing community. It is so important that we continue to invest in our priorities like public safety and infrastructure, while also doing so in a financially responsible manner.”

The Town has two ratings with S&P, one for the Town's overall credit, referred to as the Issuer Credit Rating (ICR) and one for debt issued with excise taxes as the payment pledge for the debt – both ratings are AA+ with a stable outlook. 

The Town has two ratings with S&P, one for the Town's overall credit, and one for debt issued with excise taxes as the payment pledge for the debt.
The Town has two ratings with S&P, one for the Town's overall credit, and one for debt issued with excise taxes as the payment pledge for the debt.

“The reports affirm that the Town is in solid financial condition, and we continue making progress on our path to a 'AAA' rating,” stated Chief Financial Officer/Deputy Town Manager Scott McCarty. “The Town Council has made a series of key financial policies and practices that have resulted in our strong financial condition. As a young community that is growing at a rapid rate, the report notes the debt that has been issued to provide infrastructure needs – and articulates that the burden is manageable due to sound financial policies and smart decisions.”

How are bonds rated?

Bond ratings are assessments of the creditworthiness of a bond issuer, determining the risk that the issuer will default on its debt obligations. These ratings are typically assigned by major rating agencies, such as Standard & Poor's (S&P), Moody's, and Fitch. The ratings are divided into two main categories: investment-grade bonds and non-investment-grade (junk) bonds.

Investment-Grade Bonds

Investment-grade bonds are considered to have low to moderate credit risk. These bonds are issued by entities that are seen as financially stable and likely to meet their debt obligations.

S&P/Fitch Ratings:

AAA: The highest quality, with minimal credit risk.

AA: Very high quality, but slightly more risk than AAA.

A: High quality, with low credit risk, though more susceptible to economic changes.

BBB: Adequate quality, but with moderate risk of default under adverse economic conditions.

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