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Moody

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									Moody’s reaffirms Amherst College’s Aaa debt rating

In a report issued on January 25, 2012, Moody’s reaffirmed Amherst College’s current
Aaa/VMIG-1 rating on the College’s outstanding debt, the highest rating available. Moody’s
also removed the “credit watch” on Amherst College’s credit rating. In December 2011,
Moody’s Investors Service maintained Amherst on credit watch for possible downgrade because
of concerns about the College’s ability: 1) to remarket $50.2 million of its outstanding Series K-2
bonds; and, 2) to get an extension of a line of credit dedicated to providing liquidity support for
its variable rate debt.

In early January the College remarketed its outstanding Series K-2 bonds into a 5-year term,
locking in a historically low rate for an issuance of that term (1.70%). The remarketing drew new
investors to the College’s portfolio and was four times oversubscribed. The College’s strong
credit gives it excellent marketability in a turbulent market. The line of credit was extended for a
two year term in December 2011.

Moody’s originally issued the credit watch in August 2011 during the uncertainty in the credit
markets created by the U. S. debt ceiling crisis. At that time the College was planning for the
remarketing of its outstanding $40.8 million Series H bonds. The bonds remarketed in September
2011 for a 3-year term at a very favorable interest rate of 1.0%.

In eliminating the credit watch, Moody’s assigned a “negative outlook” to the College’s Aaa
rating, due, in part, to concerns about the College’s requirements to fund its new science center
construction project. The College is confident that it has adequate resources and liquidity for the
science center project and other needs. Standard & Poor’s Financial Services has also rated the
College’s debt AAA with a “stable outlook”.

Peter J. Shea, Amherst College Treasurer, said, “The College will build a remarkable new
science center and maintain the financial strength to meet future financial obligations. We also
believe our liquidity levels are more than adequate to service our outstanding variable rate debt.
We look forward to further discussions with Moody’s as our plans for the science center
evolve”.

								
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