Credit firms cut ratings on American Capital, Allied
HONG KONG, March 3 (Reuters) - Credit agencies slashed their ratings on U.S. financial firms American Capital Ltd (ACAS.O) and Allied Capital Corp (ALD.N) on Tuesday after they posted huge quarterly losses.
Moody's Investors Service downgraded American Capital's senior unsecured rating to B2, or five notches into junk, from the previous rating of Baa3. The outlook is negative. [ID:nWNA7941]
Fitch cut its issuer default and senior unsecured debt ratings to BB-minus from BBB-minus, or two notches above Moody's new ratings for American Capital. The ratings are on Rating Watch Negative. [ID:nWNA7926]
At the same time, Moody's downgraded Allied Capital's senior unsecured ratings further into junk, or to B1 from Ba2 with a negative outlook. [ID:nWNA7942]
The downgrades for the business development companies, which make loans to small and medium-sized businesses in return for equity stakes, come after both posted huge quarterly losses and raised doubts about their financial health. [ID:nBNG468741] (Reporting by Rafael Nam; Editing by Nick Macfie)
