Moody's: MoneyGram loan Ba1

Moody's Investors Service said it affirmed the B1 corporate family rating for MoneyGram International, Inc. and assigned a Ba1 (LGD 2, 17%) rating to the proposed $150 million senior secured revolving credit facility due 2016 and $390 million term loan B due 2017.

The outlook was revised to positive from stable.

The positive outlook reflects the potential for MoneyGram to lower the debt-to-EBITDA ratio to below 4 times by the end of 2012 and then sustain leverage around 3.5 times, Moody's said.

The potential improvement is supported by expectations for solid performance of the core money transfer business, growth in global cross-border remittances over the next two years and management's commitment to conservative financial policies, which includes steady debt reduction from free cash flow, the agency said.

MoneyGram's ratings reflect the company's strong market position in its core money transfer business and the long-term positive outlook for the worldwide money transfer industry, the agency added. MoneyGram's money transfer business has shown resiliency during economic cycles.

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