Longtime Pennsylvania Liberal Arts College’s Rating Cut to Brink of Junk
- Moody’s cuts college’s issuer rating one step to Baa3
- Small colleges financially strained from declining enrollment
Bentley Hall at Allegheny College in Meadville, Pennsylvania.
Source: Allegheny CollegeThis article is for subscribers only.
Allegheny College, a small private college in western Pennsylvania, had its credit rating lowered to the brink of junk as it grapples with lower student enrollment — a growing trend for small colleges around the country.
Moody’s Investors Service downgraded the college’s issuer rating one notch to Baa3, citing “weak financial operations” and a declining pool of applicants. The college’s revenue fell to about $80 million for the 2023 fiscal year — a roughly 7% drop from four years ago — according to its annual reports. The school has more than $50 million of outstanding debt and is wrestling with operating deficits.