Bharath questions NGC over Moody’s exit

Former minister Vasant Bharath has criticised the National Gas Company’s decision to discontinue its relationship with international ratings agency Moody’s, describing the move as an attempt to avoid scrutiny following an unfavourable assessment.

Responding in a Facebook post, Bharath said ending a relationship with a ratings agency after receiving a negative or sub-investment-grade assessment often signalled discomfort with independent oversight.

Bharath, who said he has worked in the international financial and capital markets for more than 40 years, said companies that disengage from rating agencies in such circumstances are often viewed as engaging in “ratings shopping”.

“It then goes ‘ratings shopping’, in other words, seeking out agencies more likely to provide favourable assessments which ultimately undermines confidence in the company’s governance, and transparency,” he wrote.

He said international investors generally value companies that maintain multiple independent ratings because it promotes accountability and allows markets to compare differing assessments.

According to Bharath, by removing Moody’s as an evaluator, NGC may now appear less open to scrutiny, with investors and lenders likely to question why the company chose to remove one of the world’s most recognised rating agencies instead of addressing the underlying concerns.

He warned that such concerns could weaken investor confidence and potentially increase borrowing costs.

Bharath also argued that the decision could reflect negatively on Trinidad and Tobago because NGC is a state-linked company that plays a major role in the country’s economy.

He said Moody’s methodologies often consider sovereign risk factors including fiscal stability, foreign exchange availability, institutional strength and exposure to commodity cycles.

“By criticising Moody’s framework, NGC is dismissing legitimate macroeconomic concerns facing Trinidad and Tobago,” Bharath wrote.

He added that while financial markets may tolerate weak ratings if management demonstrates transparency and a credible recovery strategy, NGC’s action suggested an unwillingness to accept independent oversight.

Bharath also dismissed suggestions that recent financial improvements at NGC could outweigh long-term structural risks tied to energy market volatility and sovereign exposure.

“For a small, energy-dependent economy seeking foreign investment, maintaining credibility with international financial institutions is critical,” he wrote.

Bharath said the issue was not whether Moody’s was correct in its assessment, but whether disengaging from a critical evaluator would strengthen or weaken market confidence.

“I suppose, at the end of the day, if you don’t know, you just don’t know!” he added.

Hours after Moody’s Investors Service withdrew NGC’s credit assessment ratings on Thursday, the company said the move was not linked to financial trouble but followed a strategic review of its external credit rating agency engagements after it discontinued its relationship with Moody’s on February 26, 2026.

In a statement, NGC said its debt covenants required the maintenance of at least one international credit rating and explained that it had historically maintained ratings from Moody’s, S&P Global Ratings and CariCRIS.

The company said it had recently adopted a “two international agency approach” following a review of its credit rating framework, financial profile, operating performance and long-term strategic objectives.

NGC also argued that Moody’s previously assigned sub-investment-grade rating did not accurately reflect the company’s standalone credit profile.

In December, Moody’s downgraded NGC’s ratings.

On Thursday, Moody’s said it had withdrawn NGC’s Ba2 corporate family rating, Ba2 baseline credit assessment and Ba2 senior unsecured notes.

NGC defended its decision by saying other international agencies had assigned the company higher ratings than Moody’s.

“However, Moody’s application of a more rigid methodological framework, particularly with respect to sovereign linkage, did not admit of sufficient flexibility to recognise NGC’s unique circumstances and standalone credit strength,” the company said.