March 5, 2014

Fitch assigns negative outlook to $400M in CT bonds

Fitch Ratings said it has given a negative rating outlook to $400 million of Connecticut's general obligation bonds expected to sell this month.

Fitch said the outlook was based on the state's reduced fiscal flexibility, significant unfunded pension liability, and reliance on one-time budget revenues, though it said recent momentum may eventually improve the state's reserve position.

It assigned a rating of 'AA' to the bonds and reaffirmed the same for the state's approximately $14.5 billion in outstanding general obligation bonds and notes.

Fitch said the rating is based on the state's "vast wealth and income resources, tempered by a comparatively high burden of debt, retirement liabilities and other fixed costs."

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