The announcement came late last night. Yahoo finance has the AP story:
Billionaire Warren Buffett’s company lost its pristine triple-A rating from Moody’s on Wednesday because the recession has diminished Berkshire Hathaway Inc.’s financial strength
Ratings agency Moody’s downgraded the credit rating for Berkshire and several of the company’s insurance subsidiaries.
Moody’s says Berkshire and its insurance companies, including National Indemnity and Geico, aren’t as strong financially because the market value of their investments has fallen. Also, Moody’s says the recession hurt Berkshire’s non-insurance businesses.
“These extraordinary market pressures have reduced the excess cushion available from National Indemnity and the other affected operations to support potential funding needs of the parent company,” Moody’s analyst Bruce Ballentine said in a statement.
Moody’s also said Berkshire’s earnings and capital base are volatile because of fluctuations in the value of its portfolio of equity derivatives.
So Moody’s Investors Service lowered Omaha-based Berkshire’s rating to “Aa2” from “Aaa.” The rating for National Indemnity and most of Berkshire’s insurers was cut to “Aa1” from “Aaa.”
The ratings for Geico and General Re fell to “Aa3” from “Aa1.” All the ratings are still well into investment grade.