Moody's knocks Northeastern to negative rating
Moody's has downgraded Northeastern Illinois University's (NEIU) Certificates of Participation (COPs) to B3 from B1, according to the investor service's website.
Ratings in the B range “are considered speculative and are subject to high credit risk,” Moody's said, adding that the NEIU downgrade was fueled by the state's struggles with finalizing a budget.
“The negative outlook reflects the potential for further credit deterioration given NEIU's exposure to ongoing potential delays and reductions in state funding with limited alternative revenue growth potential," Moody's said. "Absent state funding, further deterioration of already thin liquidity is highly likely."
The service's bond ratings range from Aaa, or “the highest credit quality,” to C. The state's rating is Baa3 negative. Moody's started its rating service in 1909 as a system to gauge “future relative creditworthiness of securities” for its investors.
Northeastern Illinois University had an enrollment of about 9,500 in fall 2016. The school has campuses in the metropolitan area of Chicago.
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