CITY OF JOHANNESBURG METROPOLITAN MUNICIPALITY - GLOBAL CREDIT RATING CO. RATING RECENT DEVELOPMENTS

GLOBAL CREDIT RATING CO. RATING RECENT DEVELOPMENTS

CITY OF JOHANNESBURG METROPOLITAN MUNICIPALITY

(a municipality as described in section 2 of the Local Government Municipal Systems Act,
2000, duly established in terms of Notice No. 6766, promulgated in the Provincial Gazette
Extraordinary of 1 October 2000 in terms of section 12(1) read with section 14(2) of the Local
Government : Municipal Structures Act, 1998, as amended)

Issuer Bond Code: BIJHB
(“municipality” or the “issuer”)



Communication to Investors

GLOBAL CREDIT RATING CO. RATING RECENT DEVELOPMENTS

Global Credit Ratings Co. (GCR Ratings) has on 13th July 2022 downgraded the City of
Johannesburg’s National scale long-term and short-term issuer Ratings to A+(ZA) and A1(ZA)
respectively. The outlook is Stable.


Rating Changes:
   -   Long Term Issuer National Scale Rating, downgraded to A+(ZA), from AA-(ZA)
   -   Short Term Issuer National Scale rating, downgraded to A1(ZA) , from A+(ZA)


Outlook:

   -   Affirmed, Stable

GCR Ratings has noted that the City’s operating performance has remained fairly stable and
that the Stable Outlook reflects GCR’s expectation that despite the metro’s high leveraged
position and increasing expense base, it appears to have sufficient diversified income streams
and liquidity sources to maintain its financial profile.

They have however also alluded that the rating considers the City’s high expense base,
exacerbated by a continually increasing level of unauthorized, irregular, fruitless and wasteful
expenditure coupled with its high gearing and more limited access to funding. This is
counterbalanced by the City’s position as the economic centre of South Africa with well-
diversified sources of internally generated revenues and moderate liquidity profile.



Johannesburg

14 July 2022

Date: 14-07-2022 09:53:00
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