Tickers: March 19
Yesterday, Moody’s Investors Service cut the ratings on Principal Financial Group Inc. and its subsidiaries under expectations that the volatility in the markets and weaker earnings due to the recession will place greater pressure on the insurer’s liquidity, the Associated Press reported. Moody’s downgraded the financial strength rating of the company’s main life insurance subsidiary to “Aa3” from “Aa2,” and lowered the senior debt rating on the holding company to “A3” from “A2.” Moody’s said it could downgrade the ratings further if liquidity constraints worsen over the next six months or if investment losses total more than $1 billion in 2009.
Fannie Mae’s refinancing volume increased to more than $41 billion last month, nearly three times its volume in January and the highest in nearly a year, the Washington Business Journal reported. Tom Lund, executive vice president of Fannie Mae’s single-family mortgage business, said borrowers are taking advantage of low mortgage rates and he expects volumes will increase this year as more homeowners become eligible to refinance under President Barack Obama’s stimulus plan.
Gannett Co. Inc. CEO Craig Dubow’s pay package was cut 60 percent last year as the publisher of The Des Moines Register’s stock price and profits shrank with an industrywide decrease in advertising revenues, the Associated Press reported. Dubow was granted compensation of $3.1 million, down from $7.9 million in 2007, which included estimates provided by the company of restricted stock and stock options that overstate what they are currently worth. Most of Dubow’s 2008 pay consisted of a $1.17 million base salary and an $875,000 bonus. This year the company has stopped paying for Dubow’s home security to save money.
Marsh & McLennan Cos. Inc. has priced a public offering of $400 million in 9.25 percent senior notes due 2019, the Associated Press reported. It will use the proceeds to repay $400 million of 7.125 percent senior notes due in June. The offering is expected to close March 23.
The number of people continuing to collect unemployment benefits rose by 185,000 to a record 5.47 million for the week ended March 7, Bloomberg reported. The Labor Department report also showed that initial jobless applications topped 600,000 last week for the seventh straight time, the worst performance since 1982.