Tag Archives: moodys investors service


Laureate’s Credit Rating Drops Because of Growing Debt

Moody’s Investors Service announced on Friday that it had downgraded the ratings outlook of Laureate Education Inc., to negative from stable. The credit-rating agency affirmed the for-profit education company’s B2 Corporate Family Rating but lowered its senior secured bank-credit facilities to B2 from B1.

Laureate has become increasingly leveraged because of debt-financed acquisitions, and Moody’s said it was concerned that returns on those investments would be insufficient to support a B2 ratin…


Moody’s Issues a Negative Outlook for Higher Education

To see the July 2014 article on Moody’s outlook for higher education, go here.

Moody’s Investors Service on Monday issued a negative outlook for higher education in 2014—which should come as a surprise to no one. The bond-rating agency’s report last week, a survey of net-tuition revenues, was grim, and its outlook for higher education in recent years has been mostly bleak.

This year Moody’s cited a weak economy that will “affect families’ willingness and ability to pay for higher education.” It …


Are Colleges Ready to Adjust to a New Higher-Education Landscape?

Moody’s Investors Service on Friday released a report with grim news, particularly for public institutions: In a survey, 28 percent of public institutions, compared with 15 percent the year before, said they expected declines in their net-tuition revenue, increasingly the lifeblood of many institutions. For private institutions, the news was not quite as dire. Nineteen percent expected declines, compared with 18 percent last year, but that finding should come with a caveat: The Moody’s survey in…


Declines in Colleges’ Net-Tuition Revenue Deepen, Survey Finds

The nation’s feeble economic recovery is contributing to an increasingly bleak economic forecast for its colleges, according to a new report.

The results of an annual tuition survey released on Friday by Moody’s Investors Service, a bond-rating company, offered grim news. Of the 114 respondents among four-year public universities, 28 percent said they expected declines in net tuition for the 2013 and 2014 fiscal years, and 44 percent reported that their net-tuition revenue increases would not …


Moody’s Report Forecasts a Gloomy Future for Public Universities

Things were supposed to get better after the 2012 fiscal year, the year that colleges fell off the “cliff” created as federal stimulus money for higher education ran out and state appropriations had yet to recover.

Instead, 2012 was just foreshadowing the difficult financial future that public colleges will continue to face, according to a new report from Moody’s Investors Service, a bond-rating company.

Moody’s analysis of median fiscal data from 2012 show that enrollment at public colleges was…


Jump in Student-Loan Interest Rates Will Cost Colleges, Too

In addition to the increased costs for borrowers and the possible political costs for Congress, the doubling of interest rates on federally subsidized student loans could cost colleges, too, according to a report released on Monday.

By letting the rate on the student loans rise from 3.4 percent to 6.8 percent, effective on Monday, Congress created a “credit negative” for American colleges, according to the report from Moody’s Investors Service, which rates debt securities. In its weekly report t…


College’s Closure Signals Problems for Others, Credit-Rating Agency Says

Saint Paul’s College, a small, private, historically black college founded in 1888 in Lawrenceville, Va., announced on June 3 that it would shut its doors at the end of the month after a proposed merger with another institution fell through.

In its weekly credit outlook, the credit-rating agency Moody’s Investors Service cautioned on Thursday that more shutdowns could follow.

“The pending closure is credit negative for a small subset of the higher-education sector with similar attributes to Sain…


Iowa Bill Bars Use of Resident Tuition Funds for Financial Aid

Iowa state legislators have passed a bill that would prohibit the state’s three public universities from using resident tuition for student financial aid. Gov. Terry Branstad, a Republican, is expected to sign the measure into law.

The statewide Board of Regents voted last summer to begin phasing out a set-aside program that used tuition revenue to support need-based financial aid. Under the bill, the universities overseen by the regents—Iowa State University, the University of Iowa, and the U…


Colleges in Northeast Face Grimmer Future, Analysis Predicts

Declining state appropriations, unstable endowment returns, a projected drop in the number of high-school graduates—there’s no shortage of grim news for higher education of late. But a new analysis from the State University of New York at Albany’s Nelson A. Rockefeller Institute of Government says institutions in the Northeast may be hit harder than the rest.

In a report released on Wednesday, Jason E. Lane, the institute’s director of education studies, argues that data show this gloomy scenari…


Moody’s Downgrades College of New Rochelle’s Bond Rating

Moody’s Investors Service issued a bond-rating downgrade—from Baa3 to Ba1—and a negative outlook for the College of New Rochelle on Wednesday. The downgrade was “based on persistent enrollment declines and a challenged student market position, steep enrollment decline in fall 2012, weakening operating performance, and thin debt-service coverage,” according to Moody’s.

The bond-rating service also cited the New York college’s “high leverage, extremely thin unrestricted liquidity, insufficient liq…