DBRS Morningstar Confirms Canadian National Railway Company’s Commercial Paper Rating at R-1 (low), Stable Trend, After the Program’s Amendment and Upsizing to $2.5 Billion

DBRS Limited (DBRS Morningstar) confirmed Canadian National Railway Company’s (CN or the Company) Commercial Paper rating of R-1 (low) with a Stable trend. The rating confirmation follows the Company’s amendment and upsizing of its Commercial Paper program to $2.5 billion from $2.0 billion. DBRS Morningstar believes that the upsizing was (1) to match CN’s Commercial Paper program size to that of its Revolving Credit Facility, which was already upsized to $2.5 billion from $2.0 billion in June 2021 and is mainly used as a backup for CN’s Commercial Paper program; and (2) to allow for additional liquidity and financial flexibility. DBRS Morningstar acknowledges that CN has historically used its Commercial Paper program to, among other things, increase timing flexibility for bond issuances and share repurchases, and the expectation is that CN will continue to do so.

ESG CONSIDERATIONS
A description of how DBRS Morningstar considers ESG factors within the DBRS Morningstar analytical framework can be found in the DBRS Morningstar Criteria: Approach to Environmental, Social, and Governance Risk Factors in Credit Ratings at https://www.dbrsmorningstar.com/research/373262.

Notes:
All figures are in Canadian dollars unless otherwise noted.

The principal methodologies are Rating Companies in the Railway Industry (January 20, 2022; https://www.dbrsmorningstar.com/research/390920), DBRS Morningstar Criteria: Commercial Paper Liquidity Support for Nonbank Issuers (March 1, 2022; https://www.dbrsmorningstar.com/research/393065), and DBRS Morningstar Criteria: Guarantees and Other Forms of Support (April 4, 2022; https://www.dbrsmorningstar.com/research/394683), which can be found on dbrsmorningstar.com under Methodologies & Criteria. Other applicable methodologies include the DBRS Morningstar Criteria: Approach to Environmental, Social, and Governance Risk Factors in Credit Ratings (February 3, 2021; https://www.dbrsmorningstar.com/research/373262).

The related regulatory disclosures pursuant to the National Instrument 25-101 Designated Rating Organizations are hereby incorporated by reference and can be found by clicking on the link under Related Documents or by contacting us at [email protected].

The rated entity or its related entities did participate in the rating process for this rating action. DBRS Morningstar had access to the accounts and other relevant internal documents of the rated entity or its related entities in connection with this rating action.

Generally, the conditions that lead to the assignment of a Negative or Positive trend are resolved within a 12-month period. DBRS Morningstar trends and ratings are under regular surveillance.

For more information on this credit or on this industry, visit www.dbrsmorningstar.com or contact us at [email protected].

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