Following its outlook revision on the state’s general credit rating, Standard & Poor’s on Monday revised the long-term rating outlook on its issuer credit rating of the California State Teachers Retirement System to stable from positive. The agency also affirmed CalSTRS’ AA-plus long-term issuer credit rating and A-1-plus short-term issuer credit rating.Standard & Poor’s on Nov. 20 revised its outlook to stable from positive on its A-plus rating for California general obligation bonds.“Although CalSTRS is a multiple-employer system, the state of California’s general credit is viewed as a proxy for the underlying credit of the school district sponsors of the fund, since the state provides substantial funding resources to school districts for educational expenses and teachers’ salaries,” the rating agency said in a news release.CalSTRS has offered credit enhancement to municipal debt issuers since 1994.According to Standard & Poor’s, CalSTRS’ long-term issuer credit rating is based on the creditworthiness of the system’s sponsors — including the state government — good independence, very strong fund management, and solid financial operations. The A-1-plus short-term issuer credit rating is based on the system’s general creditworthiness, in addition to very strong liquidity sufficient to support CalSTR’s credit enhancement program.
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