Strong UMass bond ratings reaffirmed by independent ratings agencies

BOSTON – ѴǴǻ’s, S&P Global Ratings, and Fitch Ratings all recently reaffirmed the ’ strong bond ratings, each citing effective management practices as a factor in affirming the ratings and the university’s “stable” outlook. 

In reports released in late April, the university was rated Aa2 by ѴǴǻ’s, AA by Fitch Ratings, and AA- by S&P Global, indicating that UMass maintains a strong financial footing and is well-positioned to meet its credit obligations. 

S&P Global’s report, issued April 23, 2024, cited the university’s credit as “extremely strong, characterized by its role as the leading provider of public higher education in Massachusetts,” and pointed toward “solid demand, sound management and governance oversight,” as well as comprehensive long-term strategic plans.

“These strong ratings are a direct result of the effective policies that we have collectively put in place to manage the university’s financial profile and ensure that we are acting in a way that competitively positions the university relative to its peers,” UMass President Marty Meehan said. “Our ratings reflect the solid overall financial health of the university and are driven by policies adopted by the UMass Board of Trustees and the excellent management of each of our campuses by the Chancellors and their teams.” 

“I’m grateful to President Meehan, the chancellors, their respective teams, and the Board of Trustees for exercising the effective financial discipline and data-driven strategic planning necessary to realize this reaffirmation,” said UMass Board of Trustees Chairman Stephen Karam. “The university’s bond rating is a key indicator of its overall financial strength, and I am proud that the university’s practical and appropriate management of its finances has again been validated.”

ѴǴǻ’s issued a credit opinion on April 23, 2024, that reaffirmed UMass’ Aa2 stable issuer rating, stating, “UMass benefits from solid operating and capital support from the Commonwealth of Massachusetts (Aa1 stable) and significant research activity. Excellent fiscal policy and strategy incorporates solid operating performance.”

The ѴǴǻ’s report specifically praised UMass’ active and disciplined financial oversight and accountability frameworks, which are expected to continue to drive steady positive operating performance. The report also cited strong investment support from the state, significant research activity, and “excellent strategic positioning that incorporates disciplined fiscal oversight.” 

S&P Global Ratings assigned its AA- long-term rating to bonds issued by the and reaffirmed its outstanding AA- long-term rating and underlying rating on UMass revenue bonds. 

“We’re excited to have so many aspects of our financial accountability framework, including our Enterprise Risk Management program, validated by the ratings agencies and other external parties, and are pleased to see it pay dividends for the university’s overall financial health,” said Senior Vice President for Administration and Finance Lisa Calise. “Ultimately, these controls are critical to the long-term financial health of the university and ensure that we remain on a competitive and sustainable path into the future.” 

In addition to the positive reports from the rating agencies, UMass recently received an award from the Public Risk Management Association (PRIMA) for “Outstanding Achievement for Enterprise Risk Management,” a recognition of management’s financial accountability framework that continues to underpin steady financial operations. Enterprise risk management is a component the ratings agencies consider.