Credit ratings
The joint and several liability structure helps ensure that KommuneKredit has the highest possible credit ratings from the international rating agencies Moody’s Investor Service (Aaa) and Standard & Poor’s (AAA). These credit ratings are in line with that assigned to the Danish State.
The rating agencies base their assessments on the following factors:
- Strong capitalisation
- Highly creditworthy borrowers and high-quality assets
- Very strong market and liquidity position and positive liquidity position across the curve
- The joint and several liability of the municipalities and regions
In this connection, it is paramount that a municipality cannot be declared bankrupt. This is a basic principle under Danish administrative law, which is also upheld by a High Court ruling, referring to the fact that the supervisory authority, Ministry of the Interior, must ensure that a municipality is able to meet its financial obligations.