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Ostrava and Moravian-Silesian Region maintain high rating

24. 6. 2021

The international rating created by Moody's is an independent assessment of the entity's ability and willingness to meet its future obligations, which is especially important for assessing the client's creditworthiness in obtaining external resources. The City of Ostrava and the Moravian-Silesian Region have repeatedly managed to keep their ratings at a high level.

The city of Ostrava has defended the Aa3 rating and stable outlook. The agency published an assessment based on a detailed review of the city's performance over the past year, its current financial situation, financial perspective, and considered also the environmental, social (especially in terms of the COVID-19 pandemic) and government risks.

The confirmed Aa3 rating considers the solid operational performance of the city, high liquidity which allows to eliminate the negative impact of the COVID-19 pandemic, and reasonable indebtedness which still allows the city to finance other large capital projects.

The rating outlook is stable. The credit rating agency expects the company's solid operations management, sufficient liquidity and debt ratios to remain without negative deviations in the next 12-18 months, while also considers the state's stable outlook.

The City of Ostrava has been awarded a standard rating by Moody’s since 2002, when it received the Baa1 mark. Since then, there has been several positive reassessments of the city's credit risk and its outlook. The current mark at the Aa3 level, which is identical to the rating of the entire Czech Republic, has been held by the city since October 2019.

Tomáš Macura, Mayor of Ostrava, comments on the rating as follows:

"We are really pleased to have defended the city's high rating despite the economic impact of the COVID-19 pandemic. It has been confirmed that the arrangement of financial reserves in good times and an overall prudent financial policy are not purposeless decisions. On the contrary, their benefits can be seen in times of economic fluctuations. The rating mark at the Aa3 level is, due to the credit risk of the state, currently the highest achievable in the Czech Republic, and only a few other cities outside of the city of Ostrava has achieved this rating.”

The Moravian-Silesian Region has also achieved similar results, affirming the A1 mark and stable outlook. The international rating by Moody's has been awarded to the Moravian-Silesian Region since 2005. During that time, it has gradually improved from the original level of A3 to the current A1. The Moravian-Silesian Region thus has the highest currently achievable rating with the set model of regional financing in the Czech Republic.