CITY OF CAPE TOWN METROPOLITAN MUNICIPALITY - Credit rating announcement - BICITY

Credit rating announcement - BICITY

THE CITY OF CAPE TOWN METROPOLITAN MUNICIPALITY
(A Municipality in terms of Section 155 of the Constitution of the Republic of South Africa, duly established
by notice in the Provincial Notice 479/2000 dated 22nd September 2000, of the Western Cape, pursuant
to Section 12(1) and Section 14(2) of the Local Government: Municipal Structures Act, 1998 (Act 117 of
1998) as amended)
JSE alpha code: BICITY
(“the City”)

CREDIT RATING ANNOUNCEMENT

The City hereby notifies its debt investors that Moody’s Investor Services South Africa Proprietary Limited
(“Moody’s”) has downgraded the long-term global scale and national scale issuer and debt ratings from
Ba2/Aaa.za to Ba3/Aa3.za and placed the ratings on review for downgrade. In addition, the Baseline Credit
Assessment (BCA) of the City has also been downgraded by one notch.

The rating downgrades reflects Moody’s view of the rising liquidity pressure as a result of material
shortfalls in revenue collection of a number of municipalities within the sector, that Moody's expects to
last, in the context of very weak growth. The ratings under review for further downgrade reflect significant
downside risks related to uncertainty about the South African Regional and Local Government’s capacity
to secure financing over the short and medium term, as revenues fall short of prior expectations and cash
buffers diminish. It is the intention of the City to appeal this rating and get further clarification on the
applicability thereof.

The full credit rating report is available at https://www.moodys.com/research/Moodys-downgrades-6-
South-African-sub-sovereign-issuers-ratings-placed--PR_450813.

22 July 2021

Debt Sponsor
Nedbank Corporate and Investment Banking, a division of Nedbank Limited

Date: 22-07-2021 12:11:00
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