Fitch Ratings affirms the 'AA-' long-term foreign and local currency ratings on Financement-Quebec's (FQ) medium-term note programme. The rating affirmation is in conjunction with its increase in the aggregate maximum outstanding amount under the medium-term note programme to C$15 billion from C$12 billion.
Fitch also affirms the 'AA-' long-term foreign and local currency ratings and 'F1+' short-term rating on other outstanding debt obligations of FQ, as detailed at the end of this release.
The Rating Outlook on the long-term ratings is Stable.
RATING RATIONALE:
--The rating for FQ is based on the credit strength of the Province of Quebec, Canada (the province).
KEY RATING DRIVERS:
--Changes in the credit of the province, to which FQ's rating is linked.
SECURITY:
The due and punctual payment of FQ obligations is guaranteed by the Province of Quebec.
CREDIT SUMMARY:
FQ is a government agency of the province which provides financial services to public institutions, including health care, school boards, vocational and community colleges, and universities. FQ funds its activities largely through bond financing. The medium-term notes, as with all other FQ debt obligations, are ultimately obligations of the province.
The province's long-term 'AA-' rating and short-term 'F1+' ratings are based on its solid financial management, a demonstrated commitment, albeit temporarily suspended, to achieving fiscal balance and reduced debt, a diversified economy, and ample market access to liquidity for operations and debt service. The rating is tempered by a high debt burden, which is rising over the near term because of the negative impact of the recession on the province's finances. The affirmation and Stable Outlook reflect Fitch's expectation that continued progress will be made toward achieving balance by fiscal 2014, allowing for a resumption of progress in lowering the burden of debt.
For further information on the province, please see Fitch's rating action commentary dated June 9, 2010, "Fitch Affirms Province of Quebec at 'AA-'; Outlook Stable," available on Fitch's website at www.fitchratings.com.
Fitch's affirmation of the 'AA-' rating and Stable Outlook apply to the following ratings of Financement-Quebec:
--Long-term Issuer Rating at 'AA-'; Outlook Stable;
--Short-term Issuer Rating at 'F1+';
--Local Currency Long-term Rating at 'AA-'; Outlook Stable;
--Senior unsecured debt at 'AA-'; Outlook Stable.
Applicable criteria available on Fitch's website at www.fitchratings.com includes:
--'Tax-Supported Rating Criteria', dated Dec. 21, 2009.
--'International Local and Regional Governments Rating Criteria, Outside the United States', dated March 17, 2010.
Additional information is available at www.fitchratings.com.
ALL FITCH CREDIT RATINGS ARE SUBJECT TO CERTAIN LIMITATIONS AND DISCLAIMERS. PLEASE READ THESE LIMITATIONS AND DISCLAIMERS BY FOLLOWING THIS LINK: HTTP://FITCHRATINGS.COM/UNDERSTANDINGCREDITRATINGS. IN ADDITION, RATING DEFINITIONS AND THE TERMS OF USE OF SUCH RATINGS ARE AVAILABLE ON THE AGENCY'S PUBLIC WEBSITE WWW.FITCHRATINGS.COM. PUBLISHED RATINGS, CRITERIA AND METHODOLOGIES ARE AVAILABLE FROM THIS SITE AT ALL TIMES. FITCH'S CODE OF CONDUCT, CONFIDENTIALITY, CONFLICTS OF INTEREST, AFFILIATE FIREWALL, COMPLIANCE AND OTHER RELEVANT POLICIES AND PROCEDURES ARE ALSO AVAILABLE FROM THE 'CODE OF CONDUCT' SECTION OF THIS SITE.
Contacts:
Fitch Ratings, New York
Douglas Offerman, +1-212-908-0889
Karen
Krop, +1-212-908-0661
or
Cindy Stoller, +1-212-908-0526 (Media
Relations)
cindy.stoller@fitchratings.com