Philadelphia?s GO Bond Rating Outlook Revised To Stable From Positive Due To Worsening U.S. Economic Forecast

CHICAGO (S&P Global Ratings) April 21, 2020--S&P Global Ratings revised its outlook to stable from positive on the City of Philadelphia's (A/Stable) general obligation (GO), lease non-appropriation, and general fund pledge bonds (see "Outlook Revised To Stable From Positive On Tax-Secured Debt Ratings Of Local Governments On Deep Economic Contraction," published April 17, 2020 on RatingsDirect). As we've noted in prior reviews, we believe that continued pension funding discipline, reserve level growth, and preparation to avoid financial deterioration during a recession would underpin a stronger rating; however, given the severity of the current recession and significant uncertainty as to how long social distancing and stay-at-home orders will last, potentially delaying economic recovery, we no longer believe there's a one-in-three chance

...April 21, 2020 CHICAGO (S&P Global Ratings) April 21, 2020--S&P Global Ratings revised its outlook to stable from positive on the City of Philadelphia's (A/Stable) general obligation (GO), lease non-appropriation, and general fund pledge bonds (see "Outlook Revised To Stable From Positive On Tax-Secured Debt Ratings Of Local Governments On Deep Economic Contraction," published April 17, 2020 on RatingsDirect). As we've noted in prior reviews, we believe that continued pension funding discipline, reserve level growth, and preparation to avoid financial deterioration during a recession would underpin a stronger rating; however, given the severity of the current recession and significant uncertainty as to how long social distancing and stay-at-home orders will last, potentially delaying economic recovery, we no longer believe there's a one-in-three chance that we could raise our rating on Philadelphia during our outlook horizon. While we expect the economic effects of the pandemic and ensuing...

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