Moody’s Investors Service downgraded Saints Medical Center of Lowell to Caa1 from B1 after it and the for-profit Steward Health Care System of Boston ended their merger discussions.

Moody’s cited last month’s failed merger bid as well as generally weak operating results, declining liquidity, staff departures, and softening patient volumes.

According to a Moody’s statement, Saints’ rating remains on watch for further downgrade because the agency has concerns about the hospital’s ability to finalize a merger before additional fiscal deterioration occurs.

Saints last month announced an affiliation with nonprofit Lowell General Hospital.

Steward, owned by New York private-equity firm Cerberus Capital Management LP, closed acquisitions of Quincy Medical Center and Morton Hospital last month as part of its efforts to buy community hospitals in eastern Massachusetts.

Moody’s action affected $49 million of outstanding bonds issued by the Massachusetts Health and Educational Facilities Authority.

Fitch Ratings had also downgraded the Series 1993A bonds to B-minus from BB-plus on Oct. 10.

Subscribe Now

Independent and authoritative analysis and perspective for the bond buying industry.

14-Day Free Trial

No credit card required. Complete access to articles, breaking news and industry data.