Third-party rating business calls WKU financially ‘stable’


Tucker Covey

WKU President Timothy C. Caboni sits at the Board of Regents meeting in the Regents Room inside Jody Richards Hall on Thursday, Dec. 8, 2022.

Michael Crimmins, Adminstration reporter

Moody’s Investor Services, a third party bond credit rating business, recently finished its financial report of Western Kentucky University calling the university’s “issuer rating stable.” 

Moody’s corporation is based out of New York City and provides “credible insights” on bond issuance, credit risk profiles, capital calculations, investment research and provide risk understandings from a climate perspective. 

“Our analytical tools become trusted global standards for understanding the risk of doing business with others, ” Moody’s website states. “With capabilities designed to optimize decision-making processes across organizations of all sizes, we are the chosen partner of leaders worldwide for advancing strategies for growth, risk management, sustainability and capital market access.”

On Dec. 8, Moody’s released its rating of WKU “affirming Western Kentucky University’s A2 issuer rating and the underlying A2 ratings and enhanced A1 ratings on its general receipts bonds.”

On Friday, Dec. 9, WKU President Timothy Caboni sent an email to the Board of Regents calling the rating a “ significant achievement” for the university especially in the “turbulent financial times.”

“These ratings speak to the University’s: Strong financial position and growing liquidity, Ability to sustain sound operating performance despite a constrained revenue environment, Robust financial management,  Well-balanced revenue diversity and  Favorable increase in operating and capital state support,” Caboni said in the email.

The total debt for the fiscal year of 2022 is $258 million, according to the rating. With 13,919 full-time equivalent students as of fall 2022.

Though Moody’s gave WKU credit ratings ranging from A1 to A3 and deemed the ratings stable, they also included factors that could lead them to upgrade the rating. 

Those factors include such things as a “growing student demand,” a “sustained increase in net tuition revenue,” growth in liquidity and overall wealth “relative to debt and expenses,” 

According to the NASDAQ, an issuer rating of A2 is the “sixth highest grade of a fixed-income obligations” based on the Moody’s Long-term Corporate Obligation Ratings. Obligations rated A2 are considered “upper-medium grade investments” and usually have low credit risks.

“The ratings reflect both the likelihood of default and any financial loss suffered in the event of default. Moody’s rating is widely used in the financial world…” 

Moody’s also rated WKU as an A3 concerning “outstanding Series 2013 lease revenue bonds issued by the County of Warren, KY.” A3 is a grade below A2 but is still considered to pose a low credit risk to the institute.

The full Moody’s rating can be read here.

Administration reporter Michael Crimmins can be reached at [email protected].