Moody's Investors Service downgraded the "A3" rating on Louisville, Ky.-based Baptist Healthcare System's existing debt to "Baa2," Louisville Business First reports.
The ratings agency attributed the downgrade to increases in debt, a poor short-term performance outlook and poor financial performance, according to the report. Moody's said the downgrade also reflected the health system's interim leadership following former CEO Steve Hansen's abrupt departure in March.
Moody's also assigned the "Baa2" rating to Baptist's proposed $296.5 million in bonds to be issued by the Indiana Finance Authority and the Kentucky Economic Development Finance Authority May 12. Baptist plans to use the bonds to pay for "historical capital expenditures" and to partially finance a $147 million loan to purchase Floyd Memorial Hospital in New Albany, Ind.