Prior to the pandemic, Seton Hall moved to secure a bond issuance to fund strategic capital projects. As the pandemic came ashore, the University emerged as an early leader in responding to and advancing through the health crises and is at the forefront of efforts to implement cost-saving strategies.
Upon reviewing the University's performance and plans, Moody's noted:
- Seton Hall is ahead of the curve in addressing the impact of COVID-19.
- Seton Hall operates with a business-like sense that is somewhat uncommon, which allowed the University to be in a first-mover position to address the latest challenges with COVID-19.
- Based on Moody's outreach to more than 500 institutions, Seton Hall is at the forefront of efforts to implement cost-saving options.
- The University benefits from a strong management team.
In March of this year, Moody's lowered its outlook for the higher education sector from stable to negative, citing unprecedented volatility caused by the health and economic effects of the coronavirus.
Today, Moody's downgraded its rating one notch for Seton Hall from A3 (stable) to Baa1 (stable). According to Stephen Graham, Seton Hall's Vice President for Finance and CFO, the University "fully expected a downgrade related to the debt issuance and concurs with Moody's assessment of the University's strategy and response to COVID-19."
According to Moody's, this downgrade was solely in response to the University's planned issuance of 2020 Series C Revenue Bonds (Tax-Exempt) and 2020 Series D Revenue Bonds (Federally Taxable). The planned new debt issuance for these bonds totals approximately $109 million.
Graham noted, "our new rating and stable outlook continue to reflect the University's secure financial position. Based on current market conditions, this rating will have minimal impact on the pricing of bonds issued to Seton Hall."
Seton Hall's issuance of the new revenue bonds reflects the University's commitment to mid and long-term strategic planning, goals and priorities.
Categories: Campus Life