Moody's keeps E*Trade on review

Moody's Investors Service said it is continuing to review for downgrade E*Trade Financial Corp.'s long-term issuer rating at B3 and its outstanding bonds' Caa3 rating.

E*Trade announced a capital restructuring plan intended to bolster the capital base of E*Trade Bank and to provide financial relief to the holding company in the form of substantially reduced debt interest expenses and the lengthening of the maturity profile of its long-term debt, according to the agency.

"If successfully executed, the recapitalization should be beneficial to E*Trade's credit profile and, consequently, would increase the likelihood that its B3 rating would be confirmed," Moody's vice president Alexander Yavorsky said in a statement.

"However, given the magnitude of the task, and the company's unstable financial condition, there is substantial execution risk. This is the main reason why we are continuing our review for a possible downgrade"

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