General Electric Company
9 April 2002
PRESS RELEASE: S&P Affirms General Electric AAA Ratings
Dow Jones Capital Markets Report via Dow Jones
GE today announced that Standard and Poor's affirmed GE's AAA ratings and issued
the following press release:
NEW YORK (Standard & Poor's) April 8, 2002--Standard & Poor's said today it
affirmed its triple-'A' corporate credit rating on General Electric Co. (GE),
one of the largest and most diversified industrial corporations in the world,
and General Electric Capital Corp. (GECC), following GE's recent changes in its
debt funding strategy to more appropriately reflect current market conditions,
including plans to increase its bank lines.
At the same time, the short-term 'A-1+' corporate credit ratings on Fairfield,
Conn.-based GE and GECC were affirmed. The outlook is stable.
The principal tenets underlying Standard & Poor's ratings of GE and GECC remain
unchanged and include:
-- An extremely strong operating position;
-- A highly diversified business mix, serving such markets as industrial
equipment, commercial and military aircraft engines, consumer products,
broadcasting, and financial services;
-- For GECC, a diverse portfolio has enabled the company to maintain consistency
in its consolidated profitability throughout the business cycle, despite
difficult operating environments in several of its businesses and a proactive
acquisition posture. A significant factor for the ratings for that unit is the
strength derived from its ownership by GE and the continued implicit and
explicit support it provides to GECC; and
-- Expectations that GE management is committed to the highest level of credit
quality.
The announcement that GECC plans to increase its bank back-up lines, and replace
short-term borrowings with longer-dated debt, is viewed as prudent given the
current nervousness in the overall commercial paper market. GECC has set a
target range of 25%-35% commercial paper as a percentage of total debt
outstanding by the end of 2002, compared with the current level of around 42%.
In addition, commercial paper backup bank lines are expected to increase from
the present $33.5 billion to about $50 billion. The increase in the bank lines
and decrease in commercial paper funding bolster a previously adequate cushion
in the event of commercial paper market disruption. GECC had about $101 billion
in commercial paper outstanding at March 31, 2002, down from $117 billion at the
end of 2001.
This information is provided by RNS
The company news service from the London Stock Exchange
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