Fitch: Credit Card Businesses Not Expected to Affect Nordstrom & Target's Corporate Ratings

NEW YORK--(Business Wire)--
Portfolios' issued today, Fitch Ratings says that credit card performance should
not have a negative impact on Nordstrom, Inc. and Target Corporation's corporate
ratings based on current write-off expectations. The report examines credit card
profitability at various credit card charge-off assumptions, and calculations of
leverage metrics for Nordstrom and Target on a consolidated basis, a retail-only
level, and an adjusted retail metric to reflect any losses on the credit card
portfolio.

Fitch expects significant pressure on credit card profitability to continue
through the balance of 2009 and into 2010, as charge-offs are expected to remain
at elevated levels as long as unemployment remains high.

While profit deterioration at the credit card operations at both retailers has
been pronounced, the credit card businesses should show a modest improvement
year-over-year profitability in 2010. In the event the write-off rates start
trending higher than expected based on worsening unemployment and a continued
recession, Fitch would expect the credit card businesses to be loss-making,
pressuring the companies' credit ratings.

Nordstrom's Issuer Default Rating (IDR) is 'A-' with a Negative Rating Outlook.
Under a base case scenario for 2009/2010, Fitch assumes that net charge-offs
will be in the 10%-12% range, versus the 9.4% that Nordstrom reported at the end
of the second quarter. Based on the company's current and expected liquidity
position, Fitch views its refinancing risk as manageable with $350 million in
credit card secured debt due in 2010 and nothing due in 2011.

Target's IDR is 'A' with a Stable Rating Outlook, with its credit card portfolio
still profit-making at the current net charge-off trends, although 2009
profitability is projected to be closer to the $155 million generated in 2008
than the $797 million produced in 2007. Fitch does not expect the credit card
business to become loss-making in 2009; however, in the event that write-offs
start trending higher than 16%, the credit card portfolio could become
loss-making in 2010.

The report 'Spotlight on Retail-Owned Credit Card Portfolios' is now available
on Fitch's web site, 'www.fitchratings.com'. This report is published in
conjunction with 'Retailer Finance Arms: How Much Risk?' which presents an
analysis of the risks related to the finance arms of five European retailers as
well as Nordstrom and Target, and is also available on Fitch's web site.

Additional information is available at 'www.fitchratings.com'.

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Fitch Ratings, New York
Monica Aggarwal, CFA, 212-908-0282
or
Media Relations:
Cindy Stoller, 212-908-0526
Email: cindy.stoller@fitchratings.com

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