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BOARD OF WATER SUPPLY BOND RATING AFFIRMED AT
Aa2 AND AA+ WITH STABLE OUTLOOKS

            HONOLULU Moody's Investors Service and Fitch Ratings, which establish bond ratings used when municipalities borrow money, recently affirmed the Honolulu Board of Water Supply's (BWS) bond rating at Aa2 and AA+, respectively, maintaining a "stable outlook" in both cases. 

            ""We are very pleased with the bond rating reviews and Moody's and Fitch's determination that our bond rating should continue to be a very strong 'Aa2 and AA+'," said BWS Manager and Chief Engineer Ernest Lau.  "The Board of Water Supply is committed to improving its operations, system infrastructure and financial position and this bond rating is the result of that ongoing commitment to our ratepayers."

Moody's noted that the rating and outlook reflects "Moody's expectation that system financial operations will continue to benefit from sound management practices, approved multi-year rate increases and no additional borrowing plans."

In its report, Fitch cited that the Board's "Financial performance and liquidity is strong" and that "Revenues are relatively stable given the consistent demand."  Fitch also noted that   "The system has rights to sufficient ground water supplies to meet its anticipated needs with limited treatment costs and no regulatory issues at present.  The advantageous water supply results in affordable rates for the system, even with scheduled increases."

The bond ratings from Moody's and Fitch should be seen as an affirmation of the BWS's creditworthiness, and will thus ensure low borrowing costs for the BWS in the bond market.  

Bond ratings are an independent opinion of the general creditworthiness of an issuer, such as the BWS, based on relevant risk factors.  The ratings are based on an issuer's ability to repay the principal and interest of its short-term or long-term debt obligations on a timely basis.

Contact:  Kurt Tsue, Board of Water Supply, 748-5320.