Citing Lack Of Information, Ratings Agency S&P Withdraws USVI Ratings With 'Negative Implications'

Standard and Poor’s Global Rating (S&P), one of the top three U.S. ratings agencies, on Thursday announced that it was withdrawing its USVI ratings because the local government had refused to provide the information needed to support S&P’s ratings on the territory’s matching fund (rum cover over) and gross receipt tax notes.

“S&P Global Ratings has withdrawn its ‘CCC+’ ratings on the Virgin Islands Public Finance Authority’s senior and subordinate-lien matching fund loan notes, issued for the U.S. Virgin Islands (USVI), as well as its ‘CCC’ rating on the authority’s gross receipts tax (GRT) notes. We withdrew the ratings today immediately after they were removed from CreditWatch with negative implications,” reads the release, issued Thursday.

“This action follows USVI’s indication of its intent as of Aug. 25, 2017, to stop directly providing information to us to support our rating on the authority’s matching fund notes and GRT loan notes,” said S&P Global Ratings credit analyst Oladunni Ososami, “and our subsequent attempt to obtain timely information of satisfactory quality to maintain our rating on the securities in accordance with our applicable criteria and policies.”

The Thursday announcement follows Governor Kenneth Mapp’s August 22 appearance on local radio, where he said his administration would sever ties with all three ratings agencies. “I’m not taking on the issues of the rating agencies, they will not pretty much have more to write about the territory. We’ve severed our ties with them; there’s no need,” Mr. Mapp said on WSTA 1340 AM. “We don’t have market access, so it makes very little sense for the rating agencies to come telling you every other month you can’t borrow no money.”

Read more: http://viconsortium.com/featured/sp-withdraws-from-usvi/