S&P lowers Allied Capital outlook to negative

Standard & Poor's said it revised its outlook on Allied Capital Corp. to negative from stable.

At the same time, the agency said it affirmed its ratings on Allied, including the BBB+ long-term counterparty credit rating.

The agency said that this outlook revision reflects its increased concern about Allied's ability to maintain financial performance consistent with the current rating.

S&P added that it has become concerned during this downturn because of the likelihood that poor economic conditions will persist for longer than we had anticipated.

Two of the firm's largest investments have run into difficulty and a prolonged or deep recession is likely to impair the performance of, and reduce cash flow from, other portfolio companies, the agency said.

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