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GM Debt Outlook Cut to Negative By Moody's on GMAC
April 25 (Bloomberg) -- General Motors Corp.'s debt outlook was cut to negative by Moody's Investors Service on concern that problems at its part-owned GMAC LLC finance company might hurt the automaker's ability to offer vehicle loans.
Moody's today kept GM's rating unchanged at B3, or six steps below investment grade. Its outlook on the Detroit-based automaker had been stable.
GMAC, which is owned 49 percent by GM and provides a majority of its car loans, yesterday said it arranged a $750 million revolving credit facility for its Residential Capital LLC home-lending business after defaults on housing loans rose and ResCap's cash ran short.
The finance company's support for ResCap ``could weaken GMAC's own credit profile and limit its ability to access the secured and unsecured debt markets,'' Moody's analyst Bruce Clark wrote in a report. ``Moody's views the potential erosion in GMAC's credit profile and its ability to fund retail and wholesale receivables as a material risk factor for GM.''
http://www.bloomberg.com/apps/news?pid=newsarchive&sid=arOmoWk9f1u0
April 25 (Bloomberg) -- General Motors Corp.'s debt outlook was cut to negative by Moody's Investors Service on concern that problems at its part-owned GMAC LLC finance company might hurt the automaker's ability to offer vehicle loans.
Moody's today kept GM's rating unchanged at B3, or six steps below investment grade. Its outlook on the Detroit-based automaker had been stable.
GMAC, which is owned 49 percent by GM and provides a majority of its car loans, yesterday said it arranged a $750 million revolving credit facility for its Residential Capital LLC home-lending business after defaults on housing loans rose and ResCap's cash ran short.
The finance company's support for ResCap ``could weaken GMAC's own credit profile and limit its ability to access the secured and unsecured debt markets,'' Moody's analyst Bruce Clark wrote in a report. ``Moody's views the potential erosion in GMAC's credit profile and its ability to fund retail and wholesale receivables as a material risk factor for GM.''
http://www.bloomberg.com/apps/news?pid=newsarchive&sid=arOmoWk9f1u0