EVN - Q4 Quarterly Credit Commentary - Municipal Credit 2020 And Beyond

• The municipal securities most affected by the pandemic were in the sectors of transportation, hospitality and entertainment, higher education, and healthcare; and most of these sectors did receive CARES Act funding.
• Moody's notes that although COVID-19 continues to weigh on credit quality in US public finance, the sector demonstrates overall stability.
• Outlooks on all states are negative, as are the outlooks on most municipal sectors.
• Recently a number of smaller, riskier continuing-care communities and land-secured deals dependent on growth have become impaired.
• The ravages of COVID-19, the specter of downgrades, and the possibility of some defaults have increased the value of bond insurance to investors, and the rate of its usage has increased.

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