CITY OF TSHWANE METROPOLITAN MUNICIPALITY - Moody's Rating Action- CTMM

Moody's Rating Action- CTMM

THE CITY OF TSHWANE METROPOLITAN MUNICIPALITY
(A municipality as described in section 2 of the Local Government Municipal Systems Act, 2000, duly
established in terms of Notice No. 6770, 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 code: CTMM)
(“City of Tshwane” or the “Issuer”)

MOODY’S RATING ACTION

Moody’s has on 25 November 2020 downgraded by one notch the City of Tshwane's long-term global rating
to Ba3 from Ba2 and maintained the negative outlook. Moody's also affirmed the long-term issuer NSR of
Aa3.za, and affirmed both the short-term issuer and NSR ratings of NP and P-1.za, respectively.

Moody’s has stated that the one notch downgrade is a result of weaker operating results and low liquidity
levels, making the Issuer less resilient in a persistently low growth environment. The shock of the pandemic
and more generally weakening operating environment will be larger and longer lasting, reflected in a deeper
erosion of credit metrics.

The affirmations of the National Scale Ratings (NSR) of the City of Tshwane reflect the individual strength
displayed by the Issuer relative to other issuers in the country. Moody’s continues to view these ratings as
appropriately positioned in a national peer comparison given their individual financial characteristics.

For additional details on the ratings action please see the press release by Moody’s on 25 November 2020
titled “Rating Action: Moody's takes action on 9 sub-sovereign entities following South African sovereign
action”, available on the following link: https://www.moodys.com/research/Moodys-takes-action-on-9-sub-
sovereign-entities-following-South--PR_436619.

Following the recent updates, the City of Tshwane’s current Credit Rating is as follows as per the Moody’s
report:

 Rating type (NSR)   Long term     Short term     Category             Rating outlook   Rating action

 Issuer               Aa3.za        P-1.za       Investment grade       Negative         Downgrade



Johannesburg
27 November 2020

Debt Sponsor
Absa Bank Limited (acting through its Corporate and Investment Bank division)

Date: 27-11-2020 11:00:00
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