The Honourable Siobhan Coady, Deputy Premier, Minister of Finance and President of Treasury Board, today commented on the news that DBRS Morningstar has upgraded the Provincial Government’s long-term debt to A from A (low), and changed the trend on all long-term ratings to stable. This is the first time in 12 years that the province has received an upgraded credit rating, and demonstrates that the province’s financial situation is moving in the right direction.
The ratings upgrade reflects Newfoundland and Labrador’s improving fiscal outlook, along with the commissioning and operations of the Muskrat Falls Project.
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“I am encouraged to hear that DBRS Morningstar has upgraded the Provincial Government’s long-term debt to A from A (low). As indicated by DBRS, factors included rate mitigation, a much improved fiscal outlook, and an expected improvement in real GDP growth in 2023 – unlike the rest of Canada – primarily because of increased mineral production and higher capital investment. We will continue to deliver on our strategic plan for financial improvement, which ensures prudent fiscal governance and responsible debt management.”
Honourable Siobhan Coady
Deputy Premier, Minister of Finance and President of Treasury Board
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Improved Outlook for Province’s Credit Rating
Investor Relations Newfoundland and Labrador
BACKGROUNDER
Assessment from Credit Rating Agencies
DBRS Morningstar, S&P Global Ratings and Moody’s provide an independent assessment of the credit worthiness of the Government of Newfoundland and Labrador, typically providing a credit rating for the short-term debt, long-term debt, and an outlook for the long-term debt rating.
Credit ratings from all three agencies indicate that the debt of the Government of Newfoundland and Labrador continues to be regarded as investment grade.
On July 19, 2023, S&P Global Ratings confirmed its rating on the province’s long-term debt at A and short-term debt at A-1. The outlook remains stable. S&P Global Ratings is expecting that the province will continue with its prudent financial management despite challenging macroeconomic conditions.
Moody’s has rated the province’s long-term debt at A1 (stable). The outlook was upgraded from negative to stable in July 2022 due to the expectation of a stabilizing debt burden and an assessment of reduced risk regarding the Muskrat Falls electricity generation project.