S&P Global Ratings Issues Top Ratings to STAR Ohio and State Liquidity Fund
COLUMBUS – For the 29th consecutive year, S&P Global Ratings has issued its top “AAAm” rating to the State Treasury Asset Reserve of Ohio (STAR Ohio). In addition, the State Liquidity Fund also received the top “AAAf” rating.
“These ratings come on the heels of the upgrades to the state’s credit rating this fall, and they further solidify Ohio’s strong financial foundation,” said Sprague. “As the country continues to face tough economic conditions and high prices across the board, the Treasurer’s office has not only been able to grow our money, but also make it go farther. With these top ratings, we’ll continue into the new year providing the best possible investment returns and credit enhancement options for Ohio’s government entities and other institutions.”
STAR Ohio allows government subdivisions – from municipalities to school districts – to invest in high-grade, short-term securities, while offering safety, penalty-free liquidity, and comparatively higher yields. The Treasurer’s office serves as the pool’s investment advisor and administrator, managing the investment of the fund’s assets.
The investment pool has seen tremendous growth in recent years as local governments sought safe and reliable investment options for COVID-19 relief funds. In July 2022, STAR Ohio hit a new all-time high of $20 billion. Additionally, in August, it was announced that the investment pool had hit the $500 million mark for total interest returned to participating entities since the beginning of Treasurer Sprague’s term.
Most recently, in December, STAR Ohio reached a 4% yield, its highest rate in nearly 15 years.
The State Liquidity Fund is the fund within the Ohio Treasury that is used to pay the state’s ongoing obligations. The Ohio Treasurer’s office also uses the fund to provide credit enhancement to local governments through the Ohio Market Access Program (OMAP) and to reduce the cost of variable rate debt issued by Ohio institutions through the Ohio Gains Liquidity Enhancement Program. With this “AAAf” rating, the Ohio Treasurer’s office will continue to be able to provide the largest possible interest rate reductions for communities and institutions as they finance infrastructure improvements.
In September, Fitch Ratings upgraded Ohio’s long-term Issuer Default Rating (IDR) to its highest level of “AAA” – the highest rating for Ohio’s IDR by one of the three main rating agencies since 1979. Additionally, in October, Moody’s revised Ohio’s outlook from “Stable” to “Positive” and affirmed the state’s Aa1 Issuer Rating.