Premier and Minister of Finance, the Hon. E. David Burt, JP, MP, is pleased to announce positive findings from a recent assessment of Bermuda conducted by ratings agency Kroll Bond Rating Agency (KBRA).
KBRA has released the results of its recent review of Bermuda, and, in their assessment, the rating agency affirmed Bermuda’s long-term rating at A+, with a stable outlook and short-term issuer rating at K1+. The A+ long-term rating is in the third tier of KBRA’s rating index and indicates that the bond issuer is determined to be of high quality with a small risk of loss due to credit-related events. The K1+ short-term rating is in the top tier of KBRA’s rating index and indicates that the issuer has an exceptional ability to meet short-term obligations.
Premier Burt said, “I am pleased to report that KBRA has again maintained Bermuda’s long and short-term issuer ratings at A+ and K1+, respectively, and the outlook remains stable, which reflects Bermuda’s commitment to fiscal restraint and consolidation (even if slightly delayed), the ongoing recovery of tourism, and KBRA’s expectations for durability in its status as a financial hub.”
“This unsolicited assessment by KBRA, along with S&P’s most recent report, help to affirm that despite the challenges and risks facing Bermuda, and the rest of the world, the Government’s prudent policy making has effectively positioned the country on a path to economic recovery.”
In their report, KBRA stated, “Bermuda’s ratings reflect its commitment to fiscal restraint and consolidation (even if slightly delayed), the ongoing recovery of tourism, and KBRA’s expectations for durability in its status as a financial hub.”
KBRA further said in their report that they expect “Bermuda to be largely resilient to moves towards global corporate tax reform although risks exist” as “Bermuda’s innovativeness positions it to be a hub in emerging financial industries.”
Premier Burt said he was also encouraged to see KBRA state within the report that Bermuda has no meaningful refinancing needs until 2027, and the fixed rate nature of government debt moderates near-term risks.
While KBRA notes that Cybersecurity risks are a key area of focus for governance and a risk that continues to rise with technological innovation, the agency observed that the cyberattack on the Government of Bermuda on Wednesday, September 20, indicates the rising risks of such events, but also served to illustrate the evolving ability to manage such risks and also may help to increase preparedness for and resilience to future events.
For access to the full report: https://www.kbra.com/publications/BVfPDTzN/kbra-affirms-a-k1-ratings-for-bermuda-stable-outlook
Premier Burt commented further on the report saying, “I am confident KBRA and other rating agencies acknowledge and appreciate that this Government has often avoided the political expedient path and focused on addressing the country’s most pressing issues head-on. As a Government, we will continue our work on tax reform, education reform, and healthcare reform, continue executing our Economic Development Strategy, reducing our deficits, and tackling the issue of underfunded liabilities to ensure economic prosperity in Bermuda for generations to come.”
About Kroll Bond Ratings Agency (KBRA)
KBRA is a global full-service rating agency with a mission to set a standard of excellence and integrity. Established in 2010, KBRA remains dedicated to the restoration of trust in credit ratings by creating new standards for assessing risk and by offering timely and transparent ratings. KBRA provides market participants with an alternative solution by delivering in-depth research across various sectors within the United States and European markets. We strive to provide the investment community with the products and tools needed to make informed investment decisions.