Moody’s Investor Service has updated its information to reflect the April 30 transaction that restructured Vanderbilt University and Vanderbilt University Medical Center into separate legal and financial entities. Vanderbilt maintains its Moody’s Aa2 rating on bonds, with a positive outlook.
“Overall, the legal and financial restructuring is credit positive for Vanderbilt University,” Moody’s said. The report noted the change significantly reduces the university’s direct risk related to patient care and will allow the governing boards of the university and the Medical Center to focus on their distinct primary missions.
Also cited by Moody’s is that following the reorganization, the university’s debt is reduced by approximately three-fourths while spendable cash only edges down modestly. According to the report, “the combination of greatly reduced debt with little change to total cash and investments dramatically improves the university’s financial leverage, a credit positive.”