S&P: General Electric view negative

Standard & Poor's said it revised the outlook on General Electric Co. and General Electric Capital Corp. to negative from stable and affirmed the AAA long-term and A-1+ short-term credit ratings.

"The negative outlook is based partly on the concerns regarding GECC's future performance and funding," S&P analyst Robert Schulz said in a statement. "In addition, fundamentals-based earnings and cash flow could decline sufficiently during the next two years to warrant a downgrade. We will continue to monitor GECC's success in executing on its funding and liquidity plans in light of capital market turmoil."

The affirmation is based on GE's massive scale, diversity and track record of managing its businesses in a variety of difficult markets and on the demonstrated ability of these businesses to earn solid profits and generate substantial cash, even in very tough economic conditions, the agency said.

Ratings reflect the company's excellent business risk profile, minimally leveraged balance sheet for its industrial operations, its significant cash flow and liquidity, its strong corporate governance and management's commitment to maintaining the highest credit quality, the agency said.

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