Ratings agency Standard & Poor's retained on Monday the AA+ credit rating of Queensland. The basis of keeping the stable rating was the state's healthy and diversified economy and very good financial management.

Queensland Treasurer Andrew Fraser attributed the credit rating to the state's fundamentals remaining strong despite setbacks.

"We are still in recovery mode from the global financial crisis, while the floods and Cyclone Yasi stunted growth last financial year and challenges in the U.S. and Eurozone remain," Mr Fraser said in a statement.

In late July, another ratings agency, Fitch, downgraded Queensland and Queensland Treasury Corporation (QTC) to negative from stable. However, Premier Anna Bligh disputed the downgrade. She claimed Fitch made a wrong assumption about the forces that would be the drivers of economic growth in the Australian state.

Ms Bligh then said that the ratings of S&P and Moody's were more reliable than Fitch's because of its familiarity with the Australian market.

Queensland has A$68.5 billion outstanding debt. News of the Fitch downgrade caused wider spreads on the state's bonds. Following the downgrade, QTC - the state's funding arm - announced that Queensland would issue debt only when dealers ask to purchase the bonds.

Richard Jackson, QTC general manager for funding and markets, said that QTC has other ways of raising the A$22 billion funding program for the current fiscal year which is until June 30, 2012. It is through base sales of new benchmark bonds on demand from domestic and international investors.

"All we did was confirm that our borrowing program remains unchanged but, as has always been the case at QTC, we do have alternative ways to fund that borrowing program," Mr Jackson told Bloomberg.