Staff Reporter
The City of Johannesburg said on Saturday that Moody’s Ratings had affirmed its long-term issuer rating at Ba3 and revised its outlook to positive, a move the municipality said reflected confidence in its financial position and economic base.
The city said the rating action followed the restoration of its compliance with Johannesburg Stock Exchange debt listings requirements after the publication of its audited annual financial statements, which led to the lifting of the suspension of its debt instruments.
It said the development had removed any potential risk linked to debt acceleration and showed that Johannesburg had sufficient liquidity to meet its obligations.
Moody’s recognised the city’s diversified economy, stable operating performance, moderate debt profile, continued access to capital funding and government grants, and its record of servicing debt during the temporary JSE suspension, according to the statement.
The city said Moody’s positive outlook reflected confidence in Johannesburg’s standalone credit profile and expectations of an improving sovereign operating environment.
It said it accepted Moody’s concerns about governance and delays in financial reporting, and had begun implementing corrective measures to strengthen internal controls, budget monitoring and compliance with statutory and regulatory reporting requirements.
City Manager Floyd Brink said the outcome was an encouraging endorsement of Johannesburg’s financial position.
“The affirmation of the City’s credit rating, together with a Positive Outlook, is an encouraging endorsement of Johannesburg’s financial resilience and economic strength. While we recognise that governance improvements remain a priority, this outcome confirms that the City is financially stable, honours its commitments, and is implementing reforms to strengthen investor confidence and improve service delivery.
“We remain focused on enhancing governance, investing in infrastructure, and creating an environment that supports economic growth and job creation,” Brink said.
The city said Moody’s had indicated it could consider an upgrade if Johannesburg showed consistent improvement in governance, budgeting and monitoring, and eliminated findings in its auditor statements.
Group Chief Financial Officer Tebogo Moraka said Johannesburg would continue focusing on stronger financial management and governance, with the aim of securing future credit rating upgrades.
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