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Two corporates shed ratings agency programs
COLUMBUS, Ohio and WARRENVILLE, Ill. (3/10/09)--Two corporates announced that they have discontinued relationships with their ratings agencies. Corporate One FCU, Columbus, Ohio, announced Friday that it is discontinuing its commercial paper program and has terminated relationships with Standard & Poor’s and Moody’s. Corporate One will save its members more than $260,000 annually primarily by no longer obtaining short-term credit ratings from the rating agencies, the credit union said in a release. “Credit unions are already being negatively affected by the current economic downturn,” Corporate One said. “Given the unreliability to generate liquidity by issuing commercial paper, it makes sense to save our members from paying for our debt ratings.” "Current high levels of cash and cash equivalents at the corporate (currently at $1.4 billion) combined with the ability to generate additional liquidity(approximately $2.1 billion) through other tested and available sources, drove the decision to discontinue our CP program," said Lee Butke, president/CEO. Members United, Warrenville, Ill., also terminated its relationship with Standard & Poor’s to trim expenses, said Todd Adams, Members United chief financial officer. The corporate also may consider suspending a second agency relationship, he added.


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