Moody's lowers JEM ratings from A2 to A3

Moody's Investors Service has downgraded the long-term ratings of JEM Southbank Pty Limited to A3 from A2. The outlook is stable.

JEM Southbank is the financing vehicle for Axiom Education Queensland Pty Ltd, which contracted with the State of Queensland to finance, build and maintain facilities at the Southbank TAFE in Brisbane, under Southbank TAFE PPP Project--a public private partnership.

The State is the long-term contractual payer of service payments required to service project debt and the Project's only meaningful source of revenue.

"JEM's rating had previously incorporated a one-notch uplift due to the then Aaa nature of the State of Queensland's rating," says Paul Ovnerud-Potter, a Moody's Vice President/Senior Analyst. "The downgrade in the State's rating removes such uplift, leading to a one-notch downgrade in JEM's rating to A3," Ovnerud-Potter adds.