Moody's Investors Service assigned its "Aa3" rating to Philadelphia-based University of Pennsylvania Health System's proposed $200 million series 2017 taxable bonds as well as its proposed $400 million series A of 2017 revenue bonds.
At the same time, Moody's affirmed the "Aa3" rating on UPHS' outstanding bonds.
The affirmation is a result of several factors, including the health system's strong market position, favorable reputation, close affiliation with the University of Pennsylvania and healthy liquidity. Moody's also acknowledged UPHS' limited debt burden and effective management of capital spending.
The outlook is stable, reflecting Moody's expectation that UPHS will maintain solid operating margins to absorb some of the decline in liquidity as construction projects progress.