WASHINGTON — General Electric lost its top credit rating from Standard & Poor’s on Thursday over concerns of rising loan losses and lower earnings at its lending arm, GE Capital.
The long-expected ratings cut — down one notch to “AA+” from “AAA” — offered further proof that the financial crisis has shaken the foundation of one of the nation’s biggest and traditionally most stable companies. In the past year, GE has posted disappointing earnings, seen loan losses grow and cut its dividend for the first time since the Great Depression. The loss of its pristine credit rating means the company will likely pay more to borrow.
Still, investors were relieved the ratings cut wasn’t worse. GE shares rose $1.08, or 12.7 percent, to close at $9.57.
Investors were also heartened by S&P’s decision to raise GE’s outlook to “stable” from “negative.”
