Moody's affirms Cendant

Moody's Investors Service affirmed Cendant Corp. and PHH Corp.'s Baa1 ratings and stable outlook.

Moody's affirmed Cendant's senior unsecured notes and convertible bonds at Baa1, senior unsecured shelf at prospective Baa1, subordinated debt at prospective Baa2, preferred shelf at prospective Baa2 and short-term at Prime-2, Cendant Capital I, II and Cendant Capital III's guaranteed preferred stock at prospective Baa2 and PHH Corp.'s senior unsecured debt at Baa1, senior unsecured shelf at prospective Baa1, senior unsecured MTNs at Baa1, issuer rating at Baa1 and short-term debt at P-2.

Moody's said these rating affirmations follow Cendant's announcement that it is exploring strategic alternatives with respect to its mortgage banking business that is operated by its wholly owned subsidiary, PHH Corp.

The affirmations of the ratings reflect Moody's opinion that the potential sale of the mortgage business is not likely to have a material impact on Cendant's stand-alone or consolidated earnings, cash flow or financial statistics because absolute debt reduction in 2004 along with organic growth in EBITDA is expected to largely offset the lost EBITDA from the mortgage business.

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