Moody's downgrades AMR

Moody's Investors Service said it downgraded the probability of default and corporate family ratings of AMR Corp. to D and Ca, respectively, upon the filing for bankruptcy in the Southern District of New York by it and certain of its subsidiaries, including American Airlines, Inc.

Concurrently, Moody's also lowered its ratings on each of the company's rated corporate debt obligations and equipment trust certificates and will withdraw these ratings as well as the corporate family and probability of default ratings.

Moody's said that while it intends to withdraw its corporate and equipment trust certificate ratings, it expects to continue to provide ratings on the company's EETCs because of the structural benefits of these financings, including the applicability of section 1110 of the U.S. Bankruptcy Code and the support of related liquidity facilities.

However, these ratings have been placed on review for possible downgrade because the company has not provided details of its fleet plans.

Moody's said it believes that the probability of American affirming its obligations under most, if not all, of these financings is high, because of either younger vintage aircraft, such as in Series 2009-1, or a large number of long-haul aircraft, such as in series 2011-2.

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