Fitch rates new CenterPoint notes BBB

Fitch Ratings assigned a BBB rating to a recent offering of $150 million of 5.75% senior unsecured notes due 2009 by CenterPoint Properties. The outlook remains stable.

Proceeds are expected to be used to reduce CenterPoint's $350 million unsecured revolving credit facility ($102 million outstanding as of June 30) and ultimately to retire $150 million senior notes maturing in January 2003.

Fitch also affirmed CenterPoint's $350 million of senior unsecured notes due 2003-2005 at BBB and $125 million of perpetual and convertible preferred stock at BBB-.

S&P puts AOL on negative watch

Standard & Poor's placed the BBB+ long-term ratings of AOL Time Warner Inc. on negative watch, due to the restructuring plan for Time Warner Entertainment Co. and uncertainty on investigations of America Online Inc.

Downside potential is expected to be one notch.

The TWE plan involves issuing AT&T $1.5 billion of AOL Time Warner common stock, a 21% interest in the restructured cable TV subsidiary and a cash payment of $2.1 billion.

The cash is expected to be debt financed and adds pressure to already weak credit ratios, S&P said. Therefore, strategies for balance sheet relief could be instrumental in the rating outcome.

Ongoing investigations into accounting practices at AOL contribute to uncertainty.

Timing of an IPO is difficult to predict given market instability.

Resolution of the watch is likely to take more than three months.

Ratings are likely to be affirmed if the company can cut $2 billion of debt, performs within EBITDA guidance and has strong prospects for further, near-term debt reduction.

Alternatively, a loss of confidence in deleveraging plans, weak operating earnings outlook, delays for a cable IPO, serious implications of the investigations, or unexpected developments could lead to a downgrade, S&P added.

Fitch confirms AOL ratings

Fitch Ratings confirmed AOL Time Warner Inc. senior ratings at BBB+, but its keeping the outlook at negative.

While Fitch believes the partnership restructuring is in the best interests of all parties involved, interim debt financing, weaker credit protection measures and ongoing accounting/regulatory issues justify the negative outlook.

In addition, the potential for a negative outcome from the SEC and DOJ investigations is also factored into the outlook.

Despite that, Fitch noted liquidity continues to remain strong and AOL recently renewed credit facilities, which consists of a $6 billion five-year facility and a $4 billion 364-day revolver with a two-year term out option.

As of June 30, AOL had $1.9 billion of borrowings under its revolving credit facility and $2.4 billion of commercial paper outstanding.

In July, AOL had about $6.7 billion of available committed funding excluding amounts available to back up outstanding commercial paper at AOL and TWE.

Liquidity is enhanced by free cash flow, which totaled about $2.4 billion at June 30, no significant debt maturities until 2004 and no anticipated share repurchase activity.

Moody's rates Momenta notes Baa3

Moody's assigned a final foreign currency long-term rating of Baa3 to the $1.25 billion of 2.5% exchangeable notes due 2007 of Momenta Cayman.

The notes are unconditionally guaranteed by SK Corp., which is rated Baa3 by Moody's. The notes convert into American Depository Shares of SK Telecom Co. Ltd (Baa2, under review for possible upgrade).

The rating outlook is stable.

Moody's said the rating is supported by SK's position as the leading oil refining and marketing company in Korea and its strategic importance to the Korean economy.

The rating also recognizes elevated leverage and difficult industry conditions, which have produced weak refining margins over the past two years due to increased domestic competition and oversupply.

S&P notes NRG extension

Standard & Poor's noted NRG Energy Inc.'s extension from lenders to Sept. 13 to post collateral for its $2 billion construction revolver helps relieve a near-term liquidity crisis but said it has no immediate effect on the rating.

The extension provides NRG with time to provide additional information to the bank group and possibly complete further asset sales to raise cash, S&P said.

While the extension buys some time to negotiate a reasonable global solution to its credit problems, NRG has no source of immediate liquidity available, the rating agency added.

S&P said it continues to believe NRG will be challenged to meet its obligations.

Moody's puts JPMorgan on review for downgrade

Moody's Investors Service placed the long-term ratings of JPMorgan Chase & Co. (senior unsecured at Aa3) and subsidiaries on review for possible downgrade, reflecting concern about current and prospective profitability and earnings volatility.

Declining activity in capital markets, restructuring expenses, and rising credit losses have all contributed to weak profitability, Moody's said. Weak operating margins and rising credit losses may exacerbate profitability pressures in the future.

Moody's said JPMorgan has ample liquidity and that the credit, market and liquidity risks of its profitable derivative franchise are well controlled.

The review will focus on the medium-term outlook for profitability and asset quality, including commercial loan exposures, industry concentrations and credit portfolio management.

S&P cuts Storebrand

Standard & Poor's downgraded Storebrand ASA.

Ratings lowered include Storebrand's €160 million 2.25% exchangeable bonds due 2006, cut to BBB- from BBB.

Moody's puts Storebrand on review

Moody's Investors Service put Storebrand on review for possible downgrade including Storebrand Livforsikring's subordinated debt at Baa1, junior subordinated debt at Baa2 and Storebrand ASA's senior debt at Baa1, subordinated debt at Baa2 and junior subordinated debt at Baa3.

Moody's said the review builds on its earlier assignment of a negative outlook, imposed in response to its concern over Storebrand Livsforsikring's weakened balance sheet due to the fall of the equity markets at a time of strategic uncertainty for the Storebrand group.

Since then, the further downturn in the equity markets has maintained pressure on Storebrand Livforsikring's balance sheet and affected the earnings of the different group operations, Moody's said.

The earnings of the company have been impacted and there was a loss of NOK397 millions in the first half of 2002, the rating agency said. Storebrand ASA, the group's ultimate holding company, also has been affected by the reduction of earnings in most of its subsidiaries.

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