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S&P affirms ResCap
Standard & Poor's said it affirmed Residential Cap LLC's ratings at BBB-/A-3 counterparty credit, BBB- senior unsecured and BB+ subordinated local-currency.
The outlook was revised to negative from stable.
The outlook revision reflects S&P's concern regarding pressure on future general operating performance, according to the agency. ResCap has maintained adequate funding and liquidity but lower production levels and reduced margins will increase pressure on overall financial performance, S&P said.
The outlook revision also reflects the increased uncertainty in borrowers' ability to obtain short-term funding and the market's reluctance to invest in any mortgage-related assets except for government-guaranteed AAA paper, the agency said.
The ratings on ResCap's parent, GMAC LLC (BB+/negative/B-1) are unaffected by ResCap's revised outlook, S&P said.
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