GRAND RAPIDS, Mich.—Calvin University is refinancing existing long-term debt and has received an A- rating from S&P for its financial position. The move is being made to reduce risk and take advantage of lower fixed rates that are currently available.
“We are pleased to receive this independent assessment of our financial position from S&P,” said Michael Le Roy, president of Calvin University. “This refunding of our long-term debt represents an exciting next step in Calvin University's long-term financial strategy.”
Due to strong demand from investors and the current low interest rate environment, the university was able to issue the bonds with an average interest rate of 3.14%. In addition to achieving a lower interest rate, the refinancing will eliminate variable-rate bank direct purchase debt, terminate interest rate swap exposure, and allow for all of the university's long-term debt to be locked in at low fixed rates.
The university has been making progress on paying down its debt over the past several years, shown steadiness in fundraising efforts (including a record-setting 2020), and has generated consistent near break-even operations due to conservative budgeting and solid expense control.
The S&P Global Ratings took into account these and a number of other factors in defining Calvin’s outlook as “stable” and in assigning its A- rating to the Michigan Finance Authority’s $63.855 million Revenue Refunding Bonds issued for Calvin University.
“As a Calvin community, we have worked together to strengthen our financial foundation over the past several years,” said Le Roy. “This diligent work combined with our recent refinancing effort is allowing us to lean further into our vision as we meet the demands of a changing environment and create new ways to invite more learners into the Calvin project.”
About Calvin University
Founded in 1876, Calvin University is a top-ranked, liberal arts university that equips its 3,300 students from 46 U.S. states, 66 countries, and four Canadian provinces to think deeply, to act justly, and to live wholeheartedly as Christ’s agents of renewal in the world. Calvin offers 100+ majors and programs, including graduate-level offerings in accounting, education, geographic information science, media and strategic communication, speech pathology and audiology, with a number of other graduate programs launching in fall 2021. Calvin students engage in intensive internships, community-based service learning, and significant research that results in publishing and presenting alongside world-class faculty. The university’s 400-acre campus is located in the vibrant city of Grand Rapids, Michigan. Discover more at calvin.edu.