IBI-Rating has affirmed the credit rating and the rating of investment attractiveness of Cherkasy city

National rating agency IBI-Rating informs on affirming of the credit rating of Cherkasy city at uaBBB grade with a «stable» outlook and the rating of investment attractiveness at invВВВ+ grade.

Such rating grades represent the sufficient investment attractiveness and sufficient capacity of the city to pay off its debt obligations. The «stable» outlook, with the highest probability, implies immutability of the rating on the horizon for 12 months.

Were taken into account:

1. The structure of the economic complex of the city and the dynamics of key indicators
Cherkasy has a sufficiently diversified economy and a powerful industrial complex. The basis of industry is formed by enterprises of the chemical, woodworking, food and mechanical engineering industries. More than 120 industrial enterprises operates in the city. The SME is represented by almost 4 thousand enterprises and by 15.5 thousand entrepreneurs. In the first half of 2019, compared to the same period of the previous year, industrial production was increased by 3.1% and amounted to UAH 13.9 billion, retail and foreign trade turnover - by 26% (to UAH 3.9 billion) and by 31% (to USD 289.1 million), respectively. Мost indicators of the economy and economic complex (including per capita) are higher or correspond to the national average.

2. Competitive advantages and disadvantages in comparison with other cities of the country
In Cherkasy are localized key state authorities of the region. In addition, the city has good logistics, a large number of educational institutions (on different profiles), and developed service, communal and social infrastructure. At the same time, competition for business and the cost of labor is lower, compared to the Kyiv.

3. Efficiency of financial policy and budget indicators
According to the results of the first half of 2019, the city budget was executed with a surplus of UAH 38.4 million. The budget revenues are based on tax revenues - their share in the total revenues of the city budget for the corresponding period was 57%. Such revenues are diversified for payers and industries, which ensures the relative stability and predictability of budget revenues. Cherkasy continues to outpace the national average in terms of city budget security.

4. The sensitivity of the budget and the city economy to the impact of negative factors
The cities need to attract additional funding, including on the restoration of urban infrastructure, housing and communal services. Part of the cost of capital infrastructure development is financed by credit (IFO's) funds received by municipal utilities under city guarantees. During January-June 2019, the amount of consolidated debt of the Cherkasy City Council decreased by UAH 50.8 million (or 8.9%) - to UAH 522.7 million in equivalent as of 01.07.2019, which was a result of the strengthening of the national currency, and also the planned repayment of individual loans. The level of consolidated debt load of the city budget is moderate.

In order to conduct the analytical research, the materials obtained from Cherkasy city have been used, including: indicators of the social and economic development, statistical data, annual treasury statements, program materials, other necessary internal information, as well as the information from the public sources, which the Rating agency considers credible.

Municipal department
For more information please contact:
Press service of IBI-Rating
(044) 362-90-84