Moody’s lowers Tobago House of Assembly

Moody’s Investors Service said it downgraded Tobago House of Assembly’s global-scale local-currency issuer rating to Baa2 from Baa1.

The outlook is negative.

This downgrade follows a recent downgrade of Trinidad and Tobago’s government bond rating to Baa2 from Baa1 and the change in the outlook to negative from stable, Moody’s said.

Tobago House of Assembly’s rating is driven by its strong linkages with Trinidad and Tobago, given that 98.7% of its revenues come from the central government, the agency said.

Furthermore, Tobago House requires approval from the central government to contract financial long-term debt, which ensures a strong level of oversight, Moody’s added.

Although it relies on the central government for almost all of its revenue, it does have considerable flexibility over its expenditures, the agency said. This allows Tobago House to react to revenue pressures and maintain positive results, Moody’s said.

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