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Moody’s upgrades Connexus credit rating
Connexus Housing has had its credit rating upgraded by ratings agency Moody’s.
The Midlands-based association’s rating has been upgraded from Baa1, which is regarded as the lower-medium grade on Moody’s credit rating scale, to A3, which is regarded as the upper-medium grade.
The company outlook has been reaffirmed as stable, reflecting what the credit rating agency describes as Connexus’ “renewed business focus”.
The upgrade on the ratings for Connexus reflects stronger-than-expected post-merger financial performance.
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Connexus was formed by the merger of South Shropshire Housing Association, Herefordshire Housing and Meres & Mosses Housing Association in 2017.
The uplift in rating comes following the Regulator of Social Housing placing Connexus under review earlier this year for breaching the Home Standard after it emerged that the association failed to fix a heating appliance that it knew to be unsafe in a home where a fire-related death later occurred.
Despite this, in October, the regulator confirmed that Connexus had retained its G2 and V2 ratings, which means it is compliant with the regulator’s governance and financial viability standards but needs to improve in some areas, and faces material risks to its finances.
Nevertheless, the regulator said that the association’s board “lacks sufficient oversight of landlord health and safety compliance with weaknesses in systems, processes and data”.
According to Connexus, Moody’s recognised that improved financial strategies, processes and personnel continue to be embedded within the association.
This has been spearheaded by recent appointments at executive and board level and a development plan that will see more than 500 homes built in the next two years.
Richard Woolley, chief executive of Connexus, said: “This upgraded rating represents the continuing hard work and dedication of all our staff, ensuring we can continue to make a lasting difference to tenants. The organisation goes from strength to strength under our revitalised board and executive team.”
