Moody's Investors Service has raised its rating on University of North Carolina Hospitals in Chapel Hill to Aa from A1. The teaching hospital is one of 41 stand-alone hospitals and eight multistate systems rated Aa by Moody's and the first to be upgraded to Aa by the New York-based agency since last August.
The upgrade reflects increasing utilization, strong finances and cash reserve growth and coincides with University of North Carolina Hospitals' Feb. 28 sale of $134 million of bonds. The rating also affects $57.7 million of debt outstanding on the facility's series 1992 debt.
Separately, Moody's lowered to Baa from Baa1 its rating on Pendleton Memorial Methodist Hospital's $31.8 million of debt. Moody's said the New Orleans hospital's rating got bumped because of market competition, declines in utilization and the facility's lackluster financial performance. Pendleton's conservative borrowing practices resulted in low liquidity balances, Moody's said.
For the fiscal year ended June 30, 1995, it had 31.6 days' cash on hand, a debt-to-capitalization ratio of 49.1% and an operating margin of 1.8%.