External credit ratings provide a useful insight into the financial robustness of an organisation.
“The credit profile of Great Places Housing Group (Great Places, A3 stable) reflects its strong balance sheet, its solid operating margin, an expected sharp increase in capital expenditure and its volatile exposure to market sales. Great Places’ credit profile also benefits from our assessment that there is a strong likelihood that the government of the United Kingdom (UK, Aa3 stable) would act in a timely manner to prevent a default.”
Following the change of the UK sovereign from a negative outlook to stable outlook, Moody’s have updated the credit opinions of 61 UK institutions including Great Places. Previously Moody’s had cut the outlook for UK housing associations from stable to negative in November 2022, which has now been reversed.
“The credit profile of Great Places Housing Group (Great Places, A3 negative) reflects its strong balance sheet, its solid operating margin – although weakened, the sharp increase in capital expenditure and its volatile exposure to market sales. Great Places’ credit profile also benefits from our assessment that there is a strong likelihood that the government of the United Kingdom (UK, Aa3 negative) would intervene in the event that Great Places faces acute liquidity stress.”
Documents
April 2024: Fitch revises outlook to stable from negative
Following the revision of the UK’s outlook to stable (22 March, 2024), Great Places’ outlook has also been moved to stable. Fitch Revises 4 UK GREs Outlook to Stable on Sovereign Action (fitchratings.com)
October 2023: Fitch affirms Great Places’ Long Term A+ credit rating, negative outlook (Short-Term rating of F1+)
The Negative Outlook reflects that of the UK sovereign rating (AA-/Negative). Under Fitch’s Government-Related Entities Rating Criteria, Great Places’ rating is capped at the UK Sovereign minus one basis. This means that a negative rating action on the UK sovereign has an impact on Great Places.
Standalone Credit Profile reflects the ‘Stronger’ assessment of revenue income and operating risk as well as its strong financial profile. Fitch expects Great Places’ strong performance to continue.
