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The Daily OrangeSyracuse among Ivy League schools in recent bond rankings
By Jeffrey Moses
Posted: 1/24/08, 10:45 PM EST Section: News
Moody's Investors Service, one of the nation's premier bond-rating agencies, has awarded Syracuse University with a prestigious Aa3 credit rating. The superior rating will enable SU to issue bonds for capital projects at favorable interest rates. It is the third highest rating awarded to private institutions of higher education.
SU's bond rating has increased from the highest upper medium grade to the lowest high grade high quality. Moody's evaluates the financial stability of the university and its ability to pay back debt. The Aa3 is a high rating, which means the university is more reliable in paying off debt.
Joe Casciari, vice president of credit risk for Société Générale, a European finance company, said a better bond rating indicates that Syracuse has more financial prowess as an academic institution.
"It is big step to go from A1 to Aa3, which is only three from the top. If you look at Harvard and Yale, they are rated very high by Moody's financial services," Casciari said. "A higher bond rating proves that Syracuse is on the move upward making Syracuse more financially sound."
The upgrade is based on SU's excellence in academics and research, outstanding student demand and a strong record of fundraising.
An increase in donations expected from its continuing $1 billion capital campaign was a big contributing force behind the rating change.
Barbara Wells, treasurer of SU, said the biggest reason for change in credit rating was because of the University's fundraising campaign.
"Moody's looks at lots of different information in determining bond rating. The main strength of the success is due to fundraising," Wells said. "The strong student demand, increases in student applications and retention rate and how well we manage the endowment are the main reasons for the change in bond rating. There is a financial benefit. It's a reflection on how sound the school is doing"
Don DePiro, financial advisor for the Union Bank of Switzerland, said a lot of factors go into determining a company's bond rating.
SU's bond rating has increased from the highest upper medium grade to the lowest high grade high quality. Moody's evaluates the financial stability of the university and its ability to pay back debt. The Aa3 is a high rating, which means the university is more reliable in paying off debt.
Joe Casciari, vice president of credit risk for Société Générale, a European finance company, said a better bond rating indicates that Syracuse has more financial prowess as an academic institution.
"It is big step to go from A1 to Aa3, which is only three from the top. If you look at Harvard and Yale, they are rated very high by Moody's financial services," Casciari said. "A higher bond rating proves that Syracuse is on the move upward making Syracuse more financially sound."
The upgrade is based on SU's excellence in academics and research, outstanding student demand and a strong record of fundraising.
An increase in donations expected from its continuing $1 billion capital campaign was a big contributing force behind the rating change.
Barbara Wells, treasurer of SU, said the biggest reason for change in credit rating was because of the University's fundraising campaign.
"Moody's looks at lots of different information in determining bond rating. The main strength of the success is due to fundraising," Wells said. "The strong student demand, increases in student applications and retention rate and how well we manage the endowment are the main reasons for the change in bond rating. There is a financial benefit. It's a reflection on how sound the school is doing"
Don DePiro, financial advisor for the Union Bank of Switzerland, said a lot of factors go into determining a company's bond rating.
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