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Moody’s Investors Service affirms UM System’s credit rating

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Kelly Wiemann

June 30, 2017

Lowers outlook to negative; University leadership continues to address challenges with bold action plans

COLUMBIA, Mo. – Moody’s Investors Service, one of the nation’s premier credit rating services, announced an affirmation of the University of Missouri System’s high-grade Aa1 credit rating, keeping the University among an elite group of institutions. At the same time, Moody’s revised the rating outlook to negative from stable, reflecting the already known challenges of enrollment and state funding.

“We are pleased with the Aa1 rating from Moody’s but also recognize the financial challenges that need to be addressed with respect to enrollment declines and cuts in state funding,” UM System President Mun Choi said. “The University of Missouri is already putting effective plans into action to increase revenues and lower costs throughout the UM System. Strategic investments in student and faculty success are top priorities on each of our four campuses as we remain focused on our mission of teaching, research and engagement.”

Aa1 is the second highest long-term credit rating an institution can receive from Moody’s; only 10 percent of the higher education institutions rated by Moody’s fall within their top two rating categories. The affirmation by Moody’s of the Aa1 rating follows Standard & Poor’s affirmation of the University’s AA+ rating in March.

UM System strengths noted by Moody’s include:

  • New leadership with clearly identified plan to address enrollment and state funding challenges;
  • Essential provider of education and health care services for State of Missouri;
  • Broad diversification of revenues;
  • Strong liquidity profile;
  • Strong UM Health Care performance; and
  • Continued successful fundraising efforts.

Moody's Investors Service is a leading provider of credit ratings, research and risk analysis. Moody's commitment and expertise contributes to transparent and integrated financial markets. The firm's ratings and analysis track debt covering more than 120 sovereign nations, approximately 11,000 corporate issuers, 21,000 public finance issuers and 72,000 structured finance obligations. Moody's Investors Service is a subsidiary of Moody's Corporation (NYSE: MCO), which reported revenue of $3.5 billion in 2015, employs approximately 10,800 people worldwide and maintains a presence in 36 countries. Further information is available at www.moodys.com.

Moody’s rating action can be found here: www.umsystem.edu/media/ur/20170630-ums-moodys-rating-action.pdf 

Moody’s full report can be found here: www.umsystem.edu/media/ur/20170629-ums-moodys-credit-opinion.pdf

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ABOUT THE UNIVERSITY OF MISSOURI SYSTEM: The University of Missouri was founded in Columbia in 1839. The University had a single campus until 1870, when the School of Mines and Metallurgy was established in Rolla. In the same year, the University assumed land-grant responsibilities of providing higher education opportunities for all citizens. In 1963, the University expanded by founding a new campus in St. Louis and acquiring the University of Kansas City, creating the present four-campus system. Today, the University of Missouri is one of the nation’s largest higher education institutions, with more than 75,000 students, a health care enterprise and a statewide extension program.