The Justice

The Moody's Investor's Service credit agency recently downgraded its rating of Brandeis, citing the University's financial and enrollment challenges. In its first-ever analysis of the University, the Standard & Poor's credit rating agency also offered a similar rating, noting strong demand for the University and strong fundraising but also pointing out the University's low financial resources.

Executive Vice President and Chief Operating Officer Jeff Apfel told the Justice that Moody's and S & P are independent agencies that advise people who want to buy securities such as bonds by assessing the likelihood of repayment. Moody's has now rated Brandeis' bonds as A1, meaning "subject to low credit risk" down from Aa3, meaning "subject to very low credit risk." The S & P rated Brandeis' for the first time as A+, meaning it is "somewhat more susceptible to the adverse effects of changes in circumstances and economic conditions than obligations in higher-rated categories."

The ratings from both credit agencies came as the University issued $178 million in bonds as fixed-rate tax-exempt debt, of which about $160 million will be used to refinance on better terms old bonds taken out to finance university capital projects. Another $18 million of that amount is new debt that will be used to reimburse Brandeis for capital costs for which the University already paid, according to the two reports and Apfel.

Apfel emphasized that the rating does not mean the University's financial situation is getting worse. "Bad things happened in 2008 to all institutions which affected us somewhat harder because we don't have the financial base but we are taking steps to fix that, and that's embodied in a plan," he said.

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