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Archive for Sunday, July 16, 2006

Agency upgrades LMH credit rating

July 16, 2006

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One of the country's top credit-rating agencies is praising Lawrence Memorial Hospital's financial condition.

Analysts with New York-based Moody's Investors Service have upgraded LMH's credit rating to A3, which moves the hospital into the upper tier of Moody's rating system.

The increased rating is meaningful because it will allow the hospital to garner lower interest rates as it issues $52 million in bonds that will be used to pay for a major hospital expansion and refinance older debt.

Hospital leaders have estimated that the better rating could save the hospital about $250,000 per year in interest expenses.

Hospital leaders also have been anxiously awaiting the Moody's report because it serves as a good report card on the hospital's financial condition. Most not-for-profit hospitals have seen their bond ratings remain steady or decline.

But Moody's analysts said LMH had "very favorable operating results" and commented that the hospital commanded a strong market share in Lawrence and Douglas County.

LMH is expected to issue the more than $50 million worth of bonds Monday. Construction is expected to begin later this year.

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