Fitch Joins Berkshire & Buffett Downgrade Brigade (BRK-B, BRK-A, BNI)

Banking, finance, and taxes

Published: February 10, 2010 3:05 pm

Last Updated: February 16, 2010 1:42 pm

Berkshire Hathaway Inc. (NYSE: BRK-B) (NYSE: BRK-A) has already seen its ratings cut last week by Standard & Poor’s over the added leverage of the Burlington Northern Santa Fe (NYSE: BNI) acquisition. Now we have Fitch Ratings joining in on the wave of downgrades. The difference here is that Berkshire Hathaway had already been under the Triple-A status, which effectively means that this is a second lowering of the bar.

Fitch lowered Berkshire Hathaway’s ratings by two notches to AA- from AA+ as the BNSF buyout changes the company’s asset profile, its capitalization and its interest coverage. The cuts were made to Berkshire Hathaway and its insurance units to AA- from AA+ on added market exposure. The ratings on the senior unsecured notes were cut to A+ from AA and the financial strength ratings of insurance subsidiaries were cut to AA+ from AAA.

This is the end of the Fitch cycle as the ratings have now been removed from a downgrade watch after being placed there in November. The rating outlook is now listed as ‘stable.’

Today’s move was no surprise. After all, there are probably no Triple-A ratings for ANY entity any longer if all of the recent worries are brought back to light…

JON C. OGG
FEBRUARY 10, 2010

The Average American Has No Idea How Much Money You Can Make Today (Sponsor)

The last few years made people forget how much banks and CD’s can pay. Meanwhile, interest rates have spiked and many can afford to pay you much more, but most are keeping yields low and hoping you won’t notice.

But there is good news. To win qualified customers, some accounts are paying almost 10x the national average! That’s an incredible way to keep your money safe and earn more at the same time. Our top pick for high yield savings accounts includes other benefits as well. You can earn up to 3.80% with a Checking & Savings Account today Sign up and get up to $300 with direct deposit. No account fees. FDIC Insured.

Click here to see how much more you could be earning on your savings today. It takes just a few minutes to open an account to make your money work for you.

Our top pick for high yield savings accounts includes other benefits as well. You can earn up to 4.00% with a Checking & Savings Account from Sofi. Sign up and get up to $300 with direct deposit. No account fees. FDIC Insured.

¹https://www.fdic.gov/national-rates-and-rate-caps