Moody's: Block unaffected

Moody's Investors Service said it does not expect to take any immediate rating action following the announcement that HSBC notified H&R Block that it is immediately terminating the parties' long-term contract under which HSBC provided all of Block's refund anticipation loans (RALs) and some of its refund anticipation checks (RACs).

The announcement is a clear credit negative, particularly since Block's two largest competitors appear to have secured at least limited RAL funding for the 2011 tax season, the agency said.

Block Financial LLC is a wholly owned subsidiary of Block and is the issuer of all of Block's corporate public debt.

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