Moody’s reviews South African governments

Moody's Investors Service said it placed the ratings of 11 South African regional and local governments' (RLGs) and 3 government-related entities' (GRIs) under review for possible downgrade.

In addition, the agency changed the outlooks on the ratings of two municipalities to negative from stable. Ratings on those two municipalities were affirmed.

Moody’s said the actions were prompted by the potential deterioration of South Africa's credit profile as captured by the recent decision to put South Africa's Baa2 government bond rating on review for downgrade.

The following ratings were placed under review:

• Amathole District Municipality: Baa1.za long-term national scale issuer rating;

• Breede Valley Municipality: Baa1.za long-term national scale issuer rating and P-2.za short-term national scale issuer rating;

• City of Cape Town: A1.za long-term national scale issuer rating, P-1.za short-term national scale issuer rating, A1.za senior unsecured bonds and A1.za senior unsecured medium-term notes;

• Ekurhuleni Metropolitan Municipality: A1.za long-term national scale issuer rating, P-1.za short-term national scale issuer rating, A1.za senior unsecured bonds and A1.za senior unsecured medium-term notes;

• City of Johannesburg: A2.za long-term national scale issuer rating, P-1.za short-term national scale issuer rating, A2.za senior unsecured bonds and A2.za senior unsecured medium-term notes;

• KwaDukuza Municipality: Baa2.za long-term national scale issuer rating;

• Metropolitan Municipality of Mangaung: A3.za long-term national scale issuer rating and P-2.za short-term national scale issuer rating;

• Mbombela: Baa1.za long-term national scale issuer rating;

• Nelson Mandela Bay Metropolitan Municipality: A1.za long-term national scale issuer rating;

• Rustenburg: A3.za long-term national scale issuer rating;

• City of Tshwane: A3.za long-term national scale issuer rating and P-2.za short-term national scale issuer rating;

• City Power Johannesburg: A2.za long-term national scale issuer rating;

• East Rand Water Care Co.: A3.za local currency issuer rating; and

• South African National Roads Agency Ltd.: Baa3/A3.za long-term issuer ratings and P-3/P-2.za short-term issuer ratings.

The following were affirmed with negative outlooks: Municipality of Bergrivier and Municipality of Umgungundlovu District.

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