Moody's applies joint default analysis to local governments in Argentina, Brazil, Colombia and Mexico

Moody's Investors Service said the application of its joint default analysis methodology to non-U.S. regional and local governments in the Americas resulted in the upgrade of 24 governments, six government-related issuers and two associated entities and the affirmation of 75 governments.

The methodology formally disaggregates the ratings of regional and local governments into four components: an assessment of the local or regional government's baseline credit risk on a scale of 1 to 21, where 1 represents the equivalent risk of Aaa, 2 represents Aa1 and so forth; the higher-tier or supporting government's domestic currency rating; an estimate of the default dependence between the local or regional government and the supporting government, expressed as a percentage; and an estimate of the likelihood of extraordinary support from the supporting government, also expressed as a percentage.

Below is a list of the joints default analysis inputs and final ratings for all of the regional and local governments in Argentina, Brazil, Colombia and Mexico affected by the new rating methodology, together with the associated government-related issuers whose ratings were changed.

Argentina

City of Buenos Aires: debt rating affirmed at B1 and Aa2.ar with a stable outlook based on a baseline credit assessment of 14, the B3 rating on the Government of Argentina, 20% probability of support and 70% default dependence.

Province of Buenos Aires: issuer rating affirmed at B3 and A3.ar with a stable outlook based on a baseline credit assessment of 16, the B3 rating on the Government of Argentina, 20% probability of support and 70% default dependence.

Province of Chaco: issuer and debt ratings affirmed at Ca and D.ar with a stable outlook based on a baseline credit assessment of 20 stemming from the province's continuing default and expected loss to bondholders

Province of Formosa: issuer and debt rating affirmed at Ca and D.ar with a stable outlook based on a baseline credit assessment of 20 stemming from the province's continuing default and expected loss to bondholders.

Province of Mendoza: foreign-currency ratings for bonds affirmed at B2 and Aa3.ar with a stable outlook constrained by Argentina's foreign-currency ceiling and based on the province's B1/Aa3.ar domestic-currency issuer ratings, which reflect a baseline credit assessment of 14, the B3 rating on the Government of Argentina, 5% probability of support and 70% default dependence

Province of Santiago del Estero: issuer rating affirmed at Caa3 and D.ar with a stable outlook based on a baseline credit assessment of 19 stemming from the province's continuing default and the expected loss to bondholders

Brazil

Ratings upgraded

State of Minas Gerais: issuer rating upgraded to B1 with a stable outlook from B2 with positive outlook based on a baseline credit assessment of 14, the Ba2 rating on the Republic of Brazil, 20% probability of support and 70% default dependence.

Ratings affirmed

State of Ceara: issuer rating affirmed at Ba2 with a stable outlook based on a baseline credit assessment of 12, the Ba2 rating on the Republic of Brazil, 20% probability of support and 70% default dependence.

City of Curitiba: issuer rating affirmed at Ba1 and Aa1.br with a stable outlook based on a baseline credit assessment of 11, the Ba2 rating on the Republic of Brazil, 20% probability of support and 70% default dependence.

City of Rio de Janeiro: issuer rating affirmed at Ba3 with a stable outlook based on a baseline credit assessment of 13, the Ba2 rating on the Republic of Brazil, 20% probability of support and 70% default dependence.

State of Sao Paulo: issuer rating affirmed at Ba2 with a stable outlook based on a baseline credit assessment of 12, the Ba2 rating on the Republic of Brazil, 35% probability of support and 70% default dependence.

Colombia

Distrito Capital of Bogota: issuer rating affirmed at Baa3 with a stable outlook based on a baseline credit assessment of 10, the Baa3 rating on the Government of Colombia, 50% probability of support and 70% default dependence.

Mexico

Ratings upgraded

Municipality of Atizapan de Zaragoza: issuer ratings upgraded to Ba1 and A1.mx with a stable outlook from Ba2 and A1.mx based on a baseline credit assessment of 11, the Ba3 rating on the State of Mexico, 20% probability of support and 90% default dependence.

Municipality of Durango: issuer ratings upgraded to Ba2 and A2.mx with a stable outlook from Ba3 and A3.mx based on a baseline credit assessment of 12, the Ba2 rating on the State of Durango, 20% probability of support and 90% default dependence.

Municipality of Guasave: issuer ratings upgraded to Ba3 and Baa1.mx with a stable outlook from B1 and Baa2.mx based on a baseline credit assessment of 13, the Ba2 rating on the State of Sinaloa, 20% probability of support and 90% default dependence.

State of Mexico: issuer ratings upgraded to Ba3 and Baa1.mx with a stable outlook from B3 and Ba3.mx based on a baseline credit assessment of 14, the Baa1 rating on the Government of Mexico, 20% probability of support and 90% default dependence.

State of Nuevo Leon: issuer ratings upgraded to Baa3 and Aa3.mx with a stable outlook from Ba1 and A1.mx based on a baseline credit assessment of 10, the Baa1 rating on the Government of Mexico, 5% probability of support and 90% default dependence. The senior secured debt ratings were affirmed at Baa1 and Aaa.mx.

State of Queretaro: issuer ratings upgraded to Baa2 and Aa2.mx with a stable outlook from Baa3 and Aa3.mx based on a baseline credit assessment of 9, the Baa1 rating on the Government of Mexico, 5% probability of support and 90% default dependence.

Municipality of Puerto Penasco: issuer ratings upgraded to Ba3 and A3.mx with a stable outlook from B1 and Baa2.mx based on a baseline credit assessment of 13, the credit risk profile of the State of Sonora, 20% probability of support and 70% default dependence.

Municipality of Tepic: issuer ratings upgraded to Ba2 and A2.mx with a stable outlook from Ba3 and A3.mx based on a baseline credit assessment of 12, the Baa3 rating on the State of Nayarit, 20% probability of support and 90% default dependence.

Municipality of Zapotlan: issuer ratings upgraded to B1 and Baa1.mx with a stable outlook from B2 and Baa3.mx based on a baseline credit assessment of 14, the credit risk profile of the State of Jalisco, 20% probability of support and 70% default dependence. The senior secured debt ratings were affirmed at provisional Ba2 and A2.mx.

Municipality of Zitacuaro: issuer ratings upgraded to Ba3 and A3.mx with a stable outlook from B1 and Baa1.mx with a positive outlook based on a baseline credit assessment of 13, the Ba1 rating on the State of Michoacan, 20% probability of support and 90% default dependence.

Ratings affirmed

Municipality of Aguascalientes: issuer ratings affirmed at Baa2 and Aa2.mx and senior secured debt ratings affirmed at Baa1 and Aaa.mx with a stable outlook based on a baseline credit assessment of 9, the credit risk profile of the State of Aguascalientes, 50% probability of support and 90% default dependence.

Municipality of Ahome: issuer ratings affirmed at Ba3 and Baa1.mx based on a baseline credit assessment of 13, the Ba2 rating on the State of Sinaloa, 20% probability of support and 90% default dependence.

State of Baja California: issuer ratings affirmed at Baa3 and Aa3.mx with a stable outlook based on a baseline credit assessment of 10, the Baa1 rating on the Government of Mexico, 5% probability of support and 90% default dependence.

Municipality of Benito Juarez: issuer ratings affirmed at B2 and Ba2.mx and senior secured debt ratings affirmed at Ba1 and A1.mx.with a stable outlook based on a baseline credit assessment of 16, the Ba1 rating on the State of Quintana Roo, 20% probability of support and 70% default dependence.

Municipality of Centro: issuer ratings affirmed at Ba2 and A2.mx with a stable outlook based on a baseline credit assessment of 12, the Baa3 rating on the State of Tabasco, 50% probability of support and 90% default dependence.

Municipality of Chalco: issuer ratings affirmed at B1 and Baa2.mx with a stable outlook based on a baseline credit assessment of 14, the Ba3 rating on State of Mexico, 20% probability of support and 90% default dependence.

State of Chiapas: issuer ratings affirmed at Ba2 and A2.mx with a stable outlook based on a baseline credit assessment of 12, the Baa1 rating on the Government of Mexico, 5% probability of support and 90% default dependence.

State of Chihuahua: issuer ratings affirmed at Baa3 and Aa3.mx and senior secured debt ratings affirmed at Baa1 and Aaa.mx with a stable outlook based on a baseline credit assessment of 10, the Baa1 rating on the Government of Mexico, 5% probability of support and 90% default dependence.

Municipality of Coacalco: issuer ratings affirmed at B1 and Baa2.mx with a stable outlook based on a baseline credit assessment of 14, the Ba3 rating on State of Mexico, 20% probability of support and 90% default dependence.

Municipality of Coatzacoalcos: issuer ratings affirmed at Ba1 and A1.mx with a stable outlook based on a baseline credit assessment of 11, the Ba1 rating on the State of Veracruz, 20% probability of support and 90% default dependence.

Municipality of Colima: issuer ratings affirmed at Ba3 and A3.mx with a stable outlook based on a baseline credit assessment of 13, the credit risk profile of the State of Colima, 20% probability of support and 90% default dependence.

Municipality of Cuautitlan Izcalli: issuer ratings affirmed at Ba3 and A3.mx with a stable outlook based on a baseline credit assessment of 13, the Ba3 rating on State of Mexico, 20% probability of support and 90% default dependence.

Municipality of Culiacan: issuer ratings affirmed at Ba3 and Baa1.mx with a stable outlook based on a baseline credit assessment of 13, the Ba2 rating on the State of Sinaloa, 20% probability of support and 90% default dependence.

State of Durango: issuer ratings affirmed at Ba2 and A2.mx with a stable outlook based on a baseline credit assessment of 12, the Baa1 rating on the Government of Mexico, 5% probability of support and 90% default dependence.

Municipality of Ecatepec: issuer ratings affirmed at B1 and Baa2.m with a stable outlook based on a baseline credit assessment of 14, the Ba3 rating on State of Mexico, 20% probability of support and 90% default dependence.

State of Guanajuato: issuer ratings affirmed at Baa1 and Aa1.mx with a stable outlook based on a baseline credit assessment of 8, the Baa1 rating on the Government of Mexico, 5% probability of support and 90% default dependence.

State of Guerrero: issuer ratings affirmed at Ba2 and A2.mx and senior secured debt ratings affirmed at Baa2 and Aa2.mx with a stable outlook based on a baseline credit assessment of 12, the Baa1 rating on the Government of Mexico, 5% probability of support and 90% default dependence.

State of Hidalgo: issuer ratings affirmed at Ba2 and A2.mx with a stable outlook based on a baseline credit assessment of 12, the Baa1 rating on the Government of Mexico, 5% probability of support and 90% default dependence.

Municipality of Huixquilucan: issuer ratings affirmed at B1 and Baa3,mx with a stable outlook based on a baseline credit assessment of 14, the Ba3 rating on State of Mexico, 20% probability of support and 90% default dependence.

Municipality of Ixtlahuaca: issuer ratings affirmed at Ba3 and Baa1.mx with a stable outlook based on a baseline credit assessment of 13, the Ba3 rating on State of Mexico, 20% probability of support and 90% default dependence.

Municipality of Leon: issuer ratings affirmed at Baa3 and Aa3.mx with a stable outlook based on a baseline credit assessment of 10, the Baa1 rating on the State of Guanajuato, 20% probability of support and 90% default dependence.

Municipality of Manzanillo: issuer ratings affirmed at Ba1 and A1.mx with a stable outlook based on a baseline credit assessment of 11, the credit risk profile of the State of Colima, 20% probability of support and 90% default dependence.

Municipality of Mexicali: issuer ratings affirmed at Ba3 and Baa1.mx with a stable outlook based on a baseline credit assessment of 13, the Baa3 rating on the State of Baja California, 20% probability of support and 90% default dependence.

Municipality of Merida: issuer ratings affirmed at Baa3 and Aa3.mx with a stable outlook based on a baseline credit assessment of 10, the Ba2 rating on the State of Yucatan, 20% probability of support and 90% default dependence.

Municipality of Metepec: issuer ratings affirmed at Baa3 and Aa3.mx with a stable outlook based on a baseline credit assessment of 10, the Ba3 rating on State of Mexico , 20% probability of support and 70% default dependence.

State of Michoacan: issuer ratings affirmed at Ba1 and A1.mx with a stable outlook based on a baseline credit assessment of 11, the Baa1 rating on the Government of Mexico, 5% probability of support and 90% default dependence.

Municipality of Monterrey: issuer ratings affirmed at Ba1 and A1.mx and senior secured debt ratings affirmed at Baa1 and Aaa.mx with a stable outlook based on a baseline credit assessment of 12, the Baa3 issuer rating on the State of Nuevo Leon, 50% probability of support and 70% default dependence.

State of Morelos: issuer ratings affirmed at Ba2 and A2.mx, debt ratings on two senior secured obligations affirmed at Baa2 and Aa1.mx, and debt rating on the senior secured Santander Serfin bank loan affirmed at Ba1 and A1.mx with a stable outlook based on a baseline credit assessment of 12, the Baa1 rating on the Government of Mexico, 5% probability of support and 90% default dependence.

State of Nayarit: issuer ratings affirmed at Baa3 and Aa3.mx with a stable outlook based on a baseline credit assessment of 10, the Baa1 rating on the Government of Mexico, 5% probability of support and 90% default dependence.

Municipality of Nogales: issuer ratings affirmed at Ba2 and A2.mx with a stable outlook based on a baseline credit assessment of 12, the credit risk profile of the State of Sonora, 20% probability of support and 90% default dependence.

Municipality of Oaxaca: issuer ratings affirmed at Ba3 and A3.mx with a stable outlook based on a baseline credit assessment of 13, the Ba2 rating on the State of Oaxaca, 20% probability of support and 90% default dependence.

State of Oaxaca: issuer ratings affirmed at Ba2 and A2.mx and senior secured debt ratings affirmed at Baa2/Aa2.mx with a stable outlook based on a baseline credit assessment of 12, the Baa1 rating on the Government of Mexico, 5% probability of support and 90% default dependence.

State of Puebla: issuer ratings affirmed at Baa3 and Aa3.mx with a stable outlook based on a baseline credit assessment of 10, the Baa1 rating on the Government of Mexico, 5% probability of support and 90% default dependence.

Municipality of Queretaro: issuer ratings affirmed at Baa1 and Aa1.mx with a stable outlook based on a baseline credit assessment of 8, the Baa2 rating on the State of Queretaro, 50% probability of support and 70% default dependence.

State of Quintana Roo: issuer ratings affirmed at Ba1 and A1.mx and senior secured debt ratings affirmed at Baa3 and Aa2.mx with a stable outlook based on a baseline credit assessment of 11, the Baa1 rating on the Government of Mexico, 5% probability of support and 90% default dependence.

Municipality of Reynosa: issuer ratings affirmed to Ba2 and A2.mx with a stable outlook based on a baseline credit assessment of 12, the Baa2 rating on the State of Tamaulipas, 20% probability of support and 90% default dependence.

Municipality of San Pedro Garza Garcia: issuer ratings affirmed at Baa3 and Aa3.mx and senior secured debt ratings affirmed at Baa1 and Aaa.mx.with a stable outlook based on a baseline credit assessment of 10, the Baa3 rating on the State of Nuevo Leon, 20% probability of support and 70% default dependence.

State of Sinaloa: issuer ratings affirmed to Ba2 and A2.mx, debt ratings on senior secured bonds affirmed at Baa3 and Aa2.mx and debt ratings on senior secured bank loan affirmed at Baa3 and Aa3.mx with a stable outlook based on a baseline credit assessment of 12, the Baa1 rating on the Government of Mexico, 5% probability of support and 90% default dependence.

State of Tabasco: issuer ratings affirmed at Baa3 and Aa3.mx and senior secured debt ratings affirmed at Baa1 and Aaa.mx with a stable outlook based on a baseline credit assessment of 10, the Baa1 rating on the Government of Mexico, 5% probability of support and 90% default dependence.

State of Tamaulipas: issuer ratings affirmed at Baa2 and Aa2.mx with a stable outlook based on a baseline credit assessment of 9, the Baa1 rating on the Government of Mexico, 5% probability of support and 90% default dependence.

Municipality of Tampico: issuer ratings affirmed at Ba2 and A2.mx with a stable outlook based on a baseline credit assessment of 12, the Baa2 rating on the State of Tamaulipas,, 20% probability of support and 90% default dependence.

Municipality of Tecamac: issuer ratings affirmed at Ba3 and Baa1.mx with a stable outlook based on a baseline credit assessment of 13, the Ba3 rating on State of Mexico, 20% probability of support and 70% default dependence.

Municipality of Texcoco: issuer ratings affirmed at Ba3 and Baa1.mx with a stable outlook based on a baseline credit assessment of 13, the Ba3 issuer rating on the State of Mexico, 20% probability of support and 90% default dependence.

State of Tlaxcala: issuer ratings affirmed at Baa3 and Aa3.mx with a stable outlook based on a baseline credit assessment of 10, the Baa1 rating on the Government of Mexico, 5% probability of support and 90% default dependence.

Municipality of Tlalnepantla: issuer ratings affirmed at Ba2 and A2.mx with a stable outlook based on a baseline credit assessment of 12, the Ba3 rating on State of Mexico, 20% probability of support and 90% default dependence.

Municipality of Toluca: issuer ratings affirmed at Baa3 and Aa3.mx with a stable outlook based on a baseline credit assessment of 10, the Ba3 rating on State of Mexico, 20% probability of support and 90% default dependence.

Municipality of Tonala: issuer ratings affirmed at Ba3 and A3.mx with a stable outlook based on a baseline credit assessment of 13, the credit risk profile of the State of Jalisco, 20% probability of support and 90% default dependence.

Municipality of Tultitlan: issuer ratings affirmed at B1 and Baa2.mx with a stable outlook based on a baseline credit assessment of 14, the Ba3 rating on State of Mexico, 20% probability of support and 90% default dependence.

Municipality of Tuxtla Gutierrez: issuer ratings affirmed at Ba3 and A3.mx with a stable outlook based on a baseline credit assessment of 13, the Ba2 rating on the State of Chiapas, 20% probability of support and 90% default dependence.

Municipality of Uruapan: issuer ratings affirmed at Ba2 and A2.mx with a stable outlook (changed from negative outlook) based on a baseline credit assessment of 12, the Ba1 rating on the State of Michoacan, 20% probability of support and 90% default dependence.

State of Veracruz: issuer ratings affirmed at Ba1 and A1.mx and senior secured debt ratings affirmed at Baa3 and Aa2.mx with a stable outlook based on a baseline credit assessment of 11, the Baa1 rating on the Government of Mexico, 5% probability of support and 90% default dependence.

State of Yucatan: issuer ratings affirmed at Ba2 and A2.mx with a stable outlook based on a baseline credit assessment of 12, the Baa1 rating on the Government of Mexico, 5% probability of support and 90% default dependence.

State of Zacatecas: issuer ratings affirmed at Ba2 and A2.mx with a stable outlook based on a baseline credit assessment of 12, the Baa1 rating on the Government of Mexico, 5% probability of support and 90% default dependence.

Municipality of Zapopan: issuer ratings affirmed at Baa3 and Aa3.mx and senior secured debt ratings affirmed at Baa1 and Aaa.mxwith a stable outlook based on a baseline credit assessment of 10, the credit risk profile of the State of Jalisco, 20% probability of support and 70% default dependence.

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