April 22 (SeeNews) - Moody's Investors Service has praised Belgrade city government's self-financing capacity and improved liquidity position in a periodic review of the Ba3 credit rating of Serbia's capital, deputy mayor Goran Vesic said.
"The rating still takes into account the relatively high level of indebtedness of the city due to the debt of 1.2 billion euro left by the previous mayor, but Moody's states that the level of indebtedness of Belgrade is decreasing and concludes that our city is the centre of the Serbian national economy," Vesic said on Saturday, according to a press release issued by the city government.
In a periodic review of Belgrade's credit rating Moody's said earlier this month that the credit profile challenges include the city's high investment requirements, associated with pressure stemming from the transport company and limited financial flexibility under the current legislative framework.
"Moody's also considers the City of Belgrade to have a strong likelihood of extraordinary support from the Government of Serbia (Ba3) in the event that the issuer were to face acute liquidity stress," the ratings agency said on April 10.
In March 2017, Moody's upgraded Belgrade's long-term issuer rating to Ba3 from B1 and changed its rating's outlook stable from positive following similar actions on Serbia's government bond rating. The creditworthiness of Belgrade is closely linked to that of the sovereign, as Serbian local governments depend on revenues that are linked to the sovereign's macroeconomic and fiscal performance, Moody's said back then.