Phoenix-based Banner Health, an operator of 33 hospitals, has a strong financial profile, robust market share and a growing insurance division, Fitch Ratings said May 31.
Such factors have secured an "AA-" rating on approximately $400 million of new bonds to be issued. The debt will be used mainly to cover capital expenditure payments as well as a smaller portion to pay off other debt.
S&P Global assigned a similar rating to new Banner Health debt June 1.
While the system had weaker financial results in 2022, it has shown a rebound in the first quarter of this year, Fitch said.
"Operational challenges clearly surfaced in fiscal 2022, although to a much lesser extent than many other providers in the sector, and year to date results (unaudited three-month results through March 31, 2023), show a definitive rebound to Banner Health's historic operating performance level," Fitch said.