REGINA – Credit rating agency Morningstar DBRS is reporting that Saskatchewan continues to maintain credit ratings of AA (low) and R-1 (middle).
AA (low) represents the Issuer Rating and Long-Term Debt credit rating for the province, while R-1 (middle) represents the short-term debt credit rating. Morningstar is reporting the trends on all credit ratings are stable.
These ratings are unchanged from what was reported six months ago by Morningstar DBRS who also reported ratings of AA (low) and R-1 (middle).
In a news release Morningstar is pointing to the relationship between Saskatchewan and the Government of Canada, who have a AAA rating with a Stable trend, in their analysis.
They are also pointing to the province’s “prudent debt management, healthy liquidity, growing population, and higher-than-average economic growth in recent years.”
As for the province’s stable trend, this reflects Morningstar’s view that Saskatchewan “remains well positioned to withstand any temporary weakness in the macroeconomic backdrop and/or commodity price volatility without materially eroding its credit profile.”
They did note in their report that high spending needs and softer revenue growth are weighing on Saskatchewan finances, pointing to the province forecasting a deficit of $819.4 million with a gradual return to balance by 2030-31.
Morningstar is estimating the operating deficit-to-operating-revenues ratio to be 3.8 per cent in 2026-27, but is expected to gradually improve afterwards.
They also are reporting that the projected deficits and sizable capital needs are driving an increase in the Province's debt burden, but it remains manageable and liquidity is ample.
