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Overlake's Financial Strength Yields "A" Bond Ratings from Moody's and S&P
[December 11, 2017]

Overlake's Financial Strength Yields "A" Bond Ratings from Moody's and S&P


Overlake Medical Center announced today an investment-grade, "A2" rating from Moody's Investor Services and an A "stable" rating from S&P Global Ratings. The ratings reflect Overlake's strong market position and operating performance just as Moody's and Fitch recently issued negative outlooks on the nonprofit healthcare sector.

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Overlake Medical Center reports strong bond ratings from Moody's, S&P Global (Photo: Business Wire)

Overlake Medical Center reports strong bond ratings from Moody's, S&P Global (Photo: Business Wire)

"These positive credit ratings reflect Overlake's sound business position as one of Washington state's leading health systems," said Overlake President and CEO J. Michael Marsh. "The healthcare industry wil continue to face ongoing challenges but we are confident we can continue to deliver exceptional patient care while maintaining long-term financial strength."



Moody's assigned an A2 rating to Overlake's Revenue Bonds, Series 2017A (Overlake Hospital Medical Center) and Refunding Revenue Bonds, Series 2017B (Overlake Hospital Medical Center) to be released by the Washington Health Care Facilities Authority, and affirmed the A2 rating on $140 million of outstanding debt. Moody's recognized Overlake's recent investments in clinics, outpatient services and collaborations with other regional providers; "We expect Overlake will continue to grow volume and maintain favorable financial performance," according to the Moody's report.

S&P Global assigned its 'A' long-term rating, recognizing Overlake's leading inpatient market share as well as strong ties and contract with Kaiser Permanente (Kaiser), formerly the Group Health Cooperative (GHC). Kaiser has a major presence on the Overlake campus. "Overlake has a history of delivering on results… and responding quickly to challenges which has allowed it to grow and swiftly strengthen its financial profile over the last several years," according to the S&P report.


These positive ratings for Overlake come at a challenging time for non-profit health care systems. Fitch recently reported a negative sector outlook for 2018, "reflecting long term challenges caused by regulatory, political and competitive uncertainty…" In its report on the overall nonprofit healthcare and hospital sector, Moody's recently revised downward its outlook for the industry from stable to negative. Moody's cited uncertainty regarding federal healthcare policy for nonprofit hospitals after the sector experienced a larger-than-expected drop in cash flow this year. "Overlake is pleased with the affirmation of our strong ratings given the recent outlook downgrade of the hospital industry as a whole from stable to negative," said Overlake interim Chief Financial Officer Andrew Tokar.

About Overlake Medical Center

Overlake Medical Center is health center located on the Eastside of Lake Washington. The hospital is licensed for 349 beds and has been offering exceptional health care for more than 50 years. Services include a comprehensive cardiac program, unparalleled cancer care and advanced surgical services, childbirth center and level 3 NICU, Level III Trauma Center, psychiatric services, and ten primary and urgent care clinics. Overlake has been named Most Wired 2017 by the American Hospital Association. It is ranked by Healthgrades for 2018 in the top 10% of hospitals in the nation for stroke care, neurosciences, pulmonary care, joint replacement, and bariatric surgery. For more information, visit overlakehospital.org.

About Moody's

Moody's Corporation (NYSE: MCO) is the parent company of Moody's Investors Service which provides credit ratings and research covering debt instruments and securities. Further information is available at www.moodys.com.

About S&P Global

S&P Global (NYSE: SPGI) is a leading provider of transparent and independent ratings, benchmarks, analytics and data to the capital and commodity markets worldwide. For more information, visit www.spglobal.com.


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