July 13, 2010
Most Rev. David M. O'Connell, C.M., 14th president of The Catholic University of America, announced today that CUA, once again, has received a very strong, positive rating from Moody's Investor Services and Standard & Poor's (S&P).
"This is the third time since 2007," observed Bishop O'Connell, "that we have received an 'A2 Stable' rating from Moody's and an 'A Stable' rating from S&P. As I leave CUA this week, I feel an immense sense of pride and gratitude that the university continues to be on a firm financial footing, something that has not always been the case in our history."
Commenting on this renewed demonstration of external confidence, CUA Vice President for Finance and Treasurer Cathy R. Wood noted that "maintaining the ratings when confronted with a difficult fiscal environment was, truly, a university-wide effort. Strong financial planning on our part as well as prudent budgeting and the building of reserves to generate a strong operating net provided a solid foundation for sustaining financial performance."
Moody's noted the following characteristics for Catholic University:
• Continued solid operating performance and debt service coverage• Distinctive role within higher education as a comprehensive institution with strong ties to the Catholic Church in America• Satisfactory liquidity and fully fixed rate debt portfolio after planned insurance• Positive multi-day cash-on-hand performance• Stable tuition discount
Moody's cited some challenges faced by the university:
• Significant competition in the region• Endowment loss due to market volatility• Investment losses that have decreased the financial cushion for debt and operations
S&P also observed some challenges:
• Strong regional competition• Relatively high tuition dependence• Lack of a comprehensive fundraising campaign
In its report, S&P highlighted the following:
• Stable enrollment• Adequate financial resources for the rating category• Strong operating performance with surpluses recorded in the last three fiscal years• Low maximum annual debt service burden
"This is very good news for The Catholic University of America," stated Bishop O'Connell.
"We are aware of the challenges we face and are implementing strategies to address and resolve them. Such strong ratings and a stable outlook put us in a great position to be able to do that as we move forward. I am so grateful to Cathy Wood and her team for their consistent hard work in keeping the institution strong and competitive."