Moody's lowers Citigroup preferreds to Baa3

Moody's Investors Service said it lowered Citigroup Inc.'s preferred stock to Baa3 from Baa2 and placed the ratings of Citigroup and its subsidiaries, including the A2 senior debt and Prime-1 short-term ratings, under review for possible downgrade.

These actions had no impact on the FDIC-guaranteed debt issued by Citigroup, which remains at Aaa with a stable outlook.

The downgrade of the holding company's preferreds was in response to an increase in the possibility that preferred dividends could be deferred, Moody's said, adding that Citigroup's current preferred dividend payments are a hurdle for future capital generation, especially when considering Citigroup's poor earnings prospects for 2009.

The agency said its review will focus on three issues: the potential for and possible implications of further systemic support, Citigroup's financial prospects and the credit implications of Citigroup's strategic initiatives.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.