Moody's Investors Service yesterday assigned a Aaa long-term rating and P-1 short-term rating to the California Public Employees' Retirement System and its soon-to-come $5 billion credit enhancement service for U.S. municipalities.
CalPERS will soon offer letters of credit, standby bond or note purchase agreements, and liquidity lines for municipal borrowers, as part of its portfolio investment activities. Established in 1932, CalPERS is the largest public pension fund in the U.S. and the third largest in the world at $171 billion as of October 2004.
As part of the rating, Moody's cited CalPERS strong funding position, its large 1.4 million member base, and the state itself as the plan's major sponsor. Moody's also cited the program's strong underwriting standards.
