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Ratings agency Standard & Poor's (S&P Global) says Palmerston North District Council would benefit the most from Three Waters legislation, while Whangārei District Council would be the most negatively affected.
The global ratings agency said it still did not have enough information to accurately forecast how the Three Waters reform would affect related debt and costs carried by local councils.
But S&P had come up with a couple of scenarios about how a transfer of water assets to centralised agencies might affect the debt ratings of councils.
S&P director Anthony Walker said there would be winners and losers if Three Waters goes ahead, with Palmerston North District Council to benefit the most, on the basis of operations, borrowing needs and debt.
"Whangārei, which has little to no water debt right now, is a clear loser based off the assumptions we've made," Walker said.
S&P director Martin Foo said the agency would update its ratings forecasts as more information from the Department of Internal Affairs became available, including valuations of the water assets, related debt held by councils and how and when the transfers of assets and debt would take place.
However, Foo said the agency had not formed an opinion on the issue of a shared governance arrangement of water assets, which provided for Treaty of Waitangi - Te Tiriti o Waitangi partners having equal seats around the table.
"We are not forming an opinion on co-governance per se," Foo said, adding: "It will be interesting to see how this political hot potato plays out because that could affect our view."
Foo said the agency was also closely monitoring costs associated with the damage caused by the recent upper North Island flooding and Cyclone Gabrielle, based on Minister of Finance Grant Robertson's early estimate of damage.
While the costs were still being tallied, Robertson said last month the damage caused by Cyclone Gabrielle would be about $13.5 billion, which was comparable to the 2011 Canterbury earthquake.
"That is an interesting analogy because those earthquakes did contribute to a downgrade of the New Zealand sovereign back in 2011," Foo said, adding the agency lowered the sovereign credit rating by one notch to double-A (AA) from double- A-plus (AA+), as a result.
"But there were several other contributing factors at the time, including some current weakness in New Zealand's external position," he said.
"And of course, now being 12 years later, there's been significant growth and nominal inflation, which means the New Zealand economy and the New Zealand budget is much, much bigger than in 2011.
"So even if the headline costs comparable to those earthquakes, the proportional cost ... should be significantly less."