Moody’s lowers Tobago House of Assembly to Baa3

Moody's Investors Service said it downgraded Tobago House of Assembly's issuer rating to Baa3 (global scale, local currency) from Baa2 and changed the outlook to negative from under review for downgrade.

The action follows the April 15 downgrade of Trinidad and Tobago's government bond rating to Baa3 from Baa2 and outlook change to negative from rating under review for downgrade.

The downgrade reflects that, in Moody's view, Tobago House of Assembly's rating is driven by its strong linkages with Trinidad and Tobago. More than 98% of Tobago House of Assembly’s revenues come from the central government.

The first driver of Trinidad and Tobago's rating action is the agency’s expectation that the material impact of sustained low oil prices will continue to negatively affect its credit profile. It incorporates the agency’s view that oil prices will remain low this year and next, and rise only slowly thereafter.

As such, a deterioration of Trinidad and Tobago's revenues will continue to have a direct impact on Tobago House of Assembly’s budget.

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