Connecticut (STOCT1:US) became the first public-debt issuer to get a grade from Kroll Bond Ratings, with a AA rank assigned to its $14 billion of general-obligation bonds, state Treasurer Denise Nappier’s office said.
The mark is Kroll’s third-highest, matching the level the state receives from Standard & Poor’s and Fitch Ratings. Moody’s Investors Service rates the state Aa3, fourth-highest. Fitch affirmed its rating today.
“Investors would welcome new credit rating options,” Nappier said in a statement. “Kroll’s entry into this market can only enhance the evaluation of Connecticut’s credit by encouraging these agencies to be more accountable to issuers and investors alike.”
Kroll has been in discussions with other public-debt issuers about ratings, Jim Nadler, president of the New York- based company, said in a phone interview today.
“We’re talking to entities across all of the municipal sectors, including project finance as well as G.O. debt and revenue bonds,” he said. He confirmed that Connecticut was Kroll’s first for public securities issuers.
Kroll was founded in 2010 and is a Nationally Recognized Statistical Rating Organization registered with the U.S. Securities and Exchange Commission, according to the release. The company was founded by Jules Kroll, known for starting the private-investigation firm that bears his name. Kroll also rates bonds backed by commercial and residential mortgages.
Connecticut requested the rating before a planned $555 million general-obligation bond issue in April, according to the statement. That sale will be used for projects such as housing and school construction.
In October, Moody’s, S&P and Fitch reached settlements resolving claims by Connecticut that the companies unfairly gave lower ratings to public bonds than corporate bonds.
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