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Credit Rating Announcement - BIEM
CITY OF EKURHULENI METROPOLITAN MUNICIPALITY
JSE alpha code: BIEM
(“City of Ekurhuleni” or “Ekurhuleni” or the “Issuer”)
CHANGE TO THE CREDIT RATING AGENCY AND THE NEW CREDIT RATING OF THE ISSUER
Bondholders are advised that the Issuer has changed its rating agency from Moody’s Investor Service
Inc (“Moody’s”) to GCR Ratings (“GCR”).
In addition, noteholders are advised that GCR Ratings has assigned City of Ekurhuleni national scale
long and short-term Issuer ratings of BBB(ZA) and A3(ZA) respectively, with effect from 20 April 2022.
The outlook is Stable.
The credit ratings take cognisance of Ekurhuleni’s position as one of the five large South African
metropolitan municipalities and therefore the ratings are negatively impacted by income c onstraint s
that have impacted operating performance and credit protection metrics.
However, GCR has considered Ekurhuleni’s revised medium-term budgets in mitigation of these
concerns and has also included a positive peer adjustment as Ekurhuleni is the only metropolitan
municipality to have received a clean audit outcome. This points to enhanced levels of operational
controls within the Metro, which should support initiatives to strengthen the financial position.
The Stable Outlook reflects GCR’s expectation that adjustments made to the budget should support a
strengthening of Ekurhuleni’s financial performance and liquidity position. Gross debt and credit
protection metrics are also expected to remain around current levels.
The full rating report is available on GCR Ratings website at
https://gcrratings.com/announcements/gcr-has-accorded-ekurhuleni-water-care-company-initial-
ratings-of-bbbza-a3za-with-a-stable-outlook/
Ekurhuleni
21 April 2022
Debt Sponsor
Absa Corporate and Investment Bank, a division of Absa Bank Limited
Date: 21-04-2022 04:11:00
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