Moody’s Investors Service has affirmed the City of Vancouver’s Aaa senior unsecured debt rating PDF file (1.3 MB) with a stable outlook. The rating reflects Vancouver’s strong liquidity, which provides robust coverage of debt and expenses, low debt levels and demonstrated strong governance.
The City maintains a stable financial outlook and predictable revenue base, with approximately 75 per cent of its operating revenue from its own sources, such as property tax and user fees. The stable outlook reflects Vancouver’s capacity to preserve a strong fiscal performance from predictable sources of revenue and low debt levels.
“Maintaining the highest possible credit rating with Moody’s confirms the City is in excellent financial standing,” says Mayor Ken Sim. “Expanding revenues and managing City spending to maintain low debt levels are top priorities to ensure continued economic stability and fiscal health.”
Vancouver’s net direct and indirect debt stood at 32.5 per cent of operating revenue in 2022, lower than similarly rated municipalities. Despite the economic challenges faced during the pandemic, economic growth has rebounded supported by a diverse range of sectors including finance, real estate, tourism and technology. Due to this financial recovery and commitment to expand City revenues streams, Moody’s predicts the City will maintain very strong debt affordability over the next three years.
Background
Moody’s Investors Service is a leading global credit agency, which rates the creditworthiness of companies, governments and the securities they issue. Credit ratings are based on various factors including cash flow, debt levels, regulatory environment and governance. The City of Vancouver continues to have among the best municipal ratings in Canada.