Moody’s has upgraded the 20-year USD450 million Senior Unsecured Bonds issued by the Panama Canal Authority (ACP) from A2 to A1 with a stable outlook.
The upgrade is consequent upon Panama Canal’s “strong performance” since the inauguration of the expansion.
The Expanded Canal, according to the rating agency, has increased overall tonnage and attracted new market segments, contributing to the waterway’s successful performance.
“Stronger cash flow generation coupled with a relatively low leverage has resulted in very solid financial metrics. This upgrade in the long-term rating is the result of the Panama Canal’s financial strength, its proven track record of institutional independence and successful governance that continue to be key to the waterway’s success,” Panama Canal Vice President for Finance, Francisco Miguez, said.
Moody’s said the rating “is one-notch above the A2 sovereign ceiling of Panama and three notches above the rating of the Government of Panama (Baa1 stable), implying low risk of moratorium restrictions and capturing the Canal’s very strong credit profile with a substantial international component of its revenues.”
Last month, the Panama Canal Board of Directors selected Ricaurte Vasquez as the next Panama Canal Administrator. Vasquez will take office on September 4, 2019, succeeding current Administrator Jorge Quijano, who concludes his seven-year term at the helm of the waterway.