The MFWire
Manage Email Alerts | Sponsorships | About MFWire | Who We Are

Subscribe to MFWire.com's News Alerts [click]

Rating:Legg Mason's Moody's Debt Rating Drop Gets Wide Coverage Not Rated 4.0 Email Routing List Email & Route  Print Print
Wednesday, October 08, 2008

Legg Mason's Moody's Debt Rating Drop Gets Wide Coverage

by: Erin Kello

A change in Legg Mason's Moody's credit rating, which in normal times would go largely unnoticed, got coverage from four news outlets Tuesday. Reuters, The Baltimore Business Journal, MarketWatch and The AP all covered Moody's decision to downgrade Legg's senior debt rating to A3 from A2. All reports cite increasing financial pressure on the firm because of the support of money market funds. The ratings agency maintained Legg's outlook at "negative".

Legg's chief financial officer C.J. Daley told the Business Journal in a statement that his company is still “well positioned to manage ongoing volatility in the financial markets, as is reflected in our solid investment grade rating.”

The move should not affect Legg's day-to-day operations, as asset managers don't really rely on debt to get financing. Also Legg, like other money fund providers, will have likely already removed risky investments from its money funds, making additional charges related to it unlikely.

The Business Journal says that Legg has pledged more than $2 billion since last Fall to support its money funds. The pub says that Legg had $2.3 billion in cash on its books as of mid-September.

Reuters quotes Moody's vice president and senior credit officer Matthew Noll as stating: "Legg Mason has ample cash for the current cash collateral needs of money market fund support; however, pricing uncertainty and potential future asset sales suggests that Legg Mason could experience a material erosion of its excess cash if such sales occurred at prices significantly below the company's current marks."  

Stay ahead of the news ... Sign up for our email alerts now

 Do You Recommend This Story?

Return to Top
 News Archives
2020: Q2Q1
2019: Q4Q3Q2Q1
2018: Q4Q3Q2Q1
2017: Q4Q3Q2Q1
2016: Q4Q3Q2Q1
2015: Q4Q3Q2Q1
2014: Q4Q3Q2Q1
2013: Q4Q3Q2Q1
2012: Q4Q3Q2Q1
2011: Q4Q3Q2Q1
2010: Q4Q3Q2Q1
2009: Q4Q3Q2Q1
2008: Q4Q3Q2Q1
2007: Q4Q3Q2Q1
2006: Q4Q3Q2Q1
2005: Q4Q3Q2Q1
2004: Q4Q3Q2Q1
2003: Q4Q3Q2Q1
2002: Q4Q3Q2Q1
 Subscribe via RSS:
Add to My Yahoo!
follow us in feedly

©All rights reserved to InvestmentWires, Inc. 1997-2020
14 Wall Street | 20th Floor | New York, NY 10005 | P: 212-331-8968 | F: 212-331-8998
Privacy Policy :: Terms of Use