NEW YORK - Moody's Investors Service said it has downgraded to A3 from A2 the bond rating assigned to Fairview Health Services' approximately $836 million of bonds outstanding issued through the city of Minneapolis.
The rating outlook is revised to negative from stable.
The downgrade and negative outlook reflect the significant downturn in financial performance in FY 2011, decline in cash balances as of FYE 2011, unexpected senior management turnover, and the potential reputational risks for Fairview following the Minnesota Attorney General's investigation of a contract company that worked onsite at Fairview facilities for a two year period.
Positive factors include Fairview's good market position in an area of the country with favorable demographics and stabilization of operating performance through the first quarter of FY 2012.
