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Fitch cuts H&R Block rating as Option One sale dies

Thu Dec 6, 2007 12:37pm EST

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NEW YORK, Dec 6 (Reuters) - Fitch Ratings on Thursday cut its rating for H&R Block Inc (HRB.N), citing increased debt levels and uncertainty around the intended divestiture of its mortgage servicing business.

Block, the largest U.S. income tax preparation company, said on Tuesday it is shutting down its Option One Mortgage Corp lending business and slashing 620 jobs because its sale of the struggling unit has fallen through. For details, see [ID:nN04482859].

Fitch lowered Block's issuer default rating one notch to "BBB," the second lowest investment grade, from "BBB-plus."

The ratings agency is keeping Block's rating on Rating Watch Negative, which means it may cut further. (Reporting by Neil Shah, Editing by Jonathan Oatis)



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