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Fitch downgrades Marsh & McLennan's debt
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Fri, Oct 29, 2004
Source UPI
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CHICAGO -- Fitch Ratings in Chicago Thursday downgraded the senior debt and long-term ratings on Marsh & McLennan in New York to BBB from A minus.
Fitch said the short-term ratings on the insurance brokerage firm remain at F2 and all ratings remain on rating watch negative. Fitch said it has lowered Marsh's senior debt rating four notches since the announced civil suit brought against the company by New York Attorney General Elliot Spitzer and allegations of collusion and price rigging. "Regardless of the ultimate outcome of the suits, Fitch believes that Marsh will suffer a material decline in its franchise value as a result of the allegations, especially given recent reputation issues suffered in its Putnam mutual fund unit, tied to improper trading practices," the rating agency said. The rating action follows recent reports of potential penalties and settlement costs in addition to continued analysis on the potential long-term impacts from recent investigations on Marsh's operating capabilities and balance sheet position. Fitch said it has considered various scenarios that will influence both future operating performance and financial leverage levels in the near future. Copyright 2004 by United Press International
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