Approximately $3.7 billion of proforma rated debt is affected.
The rating affirmation is based on a number of factors, including Sutter’s strong presence in northern California, its dominant size and its history of strong cash flow production.
Sutter also faces several challenges, including a $5 billion capital plan over the next five years and the likelihood of additional planned municipal debt.
The rating outlook has been revised to stable from negative, which reflects Sutter’s improved operating performance in fiscal year 2014 after a challenging FY 2013, and Moody’s expectation that operating results will continue to improve in FY 2015.
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