NATIONAL RATING AGENCIES

As of June 30, 2021, the Corporation had $2.4 billion in outstanding bonds and notes payable secured by assets held and the general obligation pledge of the Corporation. The Corporation’s general obligation is rated by three major rating agencies as follows. There has been no change in the Corporation’s ratings from previous years.

S&P Global 

As of March 10, 2021, S&P Global Ratings reaffirmed the AA+ issuer rating of AHFC. This rating is based on solid, high capital adequacy ratios including a five-year average S&P Global Ratings-calculated net equity to total assets of 28.5 percent, well in excess of the 15 percent benchmark for the AA rating category.

  • Large, high-performing loan portfolio of approximately $3.2 billion

  • Strong profitability evidenced by at least five consecutive period of increasing S&P Global Ratings-calculated net income

  • Strong equity position evidenced by at least five consecutive periods of S&P Global Ratings-calculated net position growth

Moody’s Investor Service’s

Moody’s Investor Service’s rating system ranks the creditworthiness of borrowers using a standard rating scale, which measures expected investor loss in the event of default. In Moody’s Investor Service’s rating system, securities are assigned a rating from Aaa to c, with Aaa being the highest quality and C the lowest quality. 

Fitch

Fitch’s credit rating scale for issuers and issues is expressed using ‘AAA’ to ‘BBB’ (investment grade) and ‘BB’ to ‘D’ (speculative grade) with an additional +/- for AA through CCC levels indicating relative differences of probability of default or recovery for issues.

 Loan and Bond Activity

  • AHFC’s total number of loans purchased decreased by 8.1% from FY2020 to FY2021, primarily due to loan payoffs

    Payoffs are good for homeowners, meaning someone has completed their mortgage obligation and/or refinanced into lower cost debt

    AHFC realized $598 million in the total dollar volume of loans purchased

AHFC’S economic strategy is to redeem debt when it is beneficial for the Corporation to do so, much like a homeowner might refinance their loan to benefit from lower cost debt. 

Under net position -- the Corporation continues to grow. With sound management, AHFC celebrates its 50th anniversary having paid back the initial investment by the State of Alaska twice over, and well-positioned to move toward its Centennial.