Staff Writer
The City of Johannesburg has retained its credit ratings from Moody’s Investors Service, with the ratings agency confirming the municipality’s long-term issuer rating at Ba3 while maintaining a positive outlook.
In a notice to bondholders, the city said Moody’s also confirmed its domestic currency senior unsecured medium-term note (MTN) programme rating at (P)Ba3, its national scale long-term issuer and MTN programme ratings at A1.za, and its short-term national scale issuer rating at P-1.za.
The City’s Baseline Credit Assessment (BCA) was also affirmed at ba3. The positive outlook remains in place, while the rating review for downgrade, which began on 17 April 2026, has now been concluded.
According to the City, Moody’s decision follows the lifting of the suspension of Johannesburg’s debt instruments by the JSE after the municipality made its audited annual financial statements for the year ended 30 June 2025 available to bondholders.
Moody’s said the confirmation reflects a reduced risk of debt acceleration and potential default on the City’s notes listed on the JSE.
However, the ratings agency noted that the City’s failure to meet the deadline for submitting its 2025 audited financial statements highlighted weaknesses in governance and management practices, factors that continue to be reflected in the Ba3 rating.
Moody’s said the ratings balance Johannesburg’s solid financial and economic fundamentals, broadly stable operating performance and moderate debt burden against weaker governance and funding-related credit challenges.
The agency added that while the City’s access to funding remains adequate, it is subject to greater uncertainty than previously, resulting in a lower assessment of its funding profile.
The positive outlook is supported by the City’s resilient standalone credit profile and expectations of improving sovereign conditions in South Africa. Moody’s noted that this mirrors the positive outlook assigned to the South African sovereign, which is currently rated Ba2.
Looking ahead, Moody’s said an upgrade of Johannesburg’s rating would depend on the municipality demonstrating sustained improvements in governance, including stronger budgeting and financial monitoring, the elimination of audit findings, and evidence of stronger sovereign support or an upgrade of South Africa’s sovereign credit rating.
