Moody’s downgraded the credit rating for Berkshire Hathaway 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.
It appears that ratings agencies are being ultra conservative after being too lenient for years in their ratings of financial companies.