S&P boosts State of Zacatecas

Standard & Poor's said it raised its national-scale rating on the State of Zacatecas, United Mexican States, to mxA+ from mxA.

The outlook remains stable.

The agency said that the upgrade is based upon continuous improvement in managerial practices that increase the state's capacity to service its historically low debt, noting that these include expedited reporting of its financial statements, external audits by internationally recognized firms and a track record of good revenue-collection capacity.

The rating reflects an adequate financial performance, with an overall surplus over the past two years, historically low debt levels and a financially solid pension system, with sufficient funds for the next 15 years, the agency said.

Factors that somewhat offset these strengths include a weak economy, with under-average growth rates and a limited financial flexibility common under the National System of Financial Coordination, S&P added.

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