Fitch to rate GM notes BB

Fitch Ratings said it expects to assign a BB rating to the senior notes of General Motors Financial Co., Inc., a subsidiary of General Motors Co. Proceeds will be used for general corporate purposes, which may include acquisitions.

The agency said the expected rating reflects General Motors Financial's relationship to its parent, solid market position in the auto finance space, seasoned management team, strong asset quality, improving operating performance and improved funding flexibility.

The ratings are constrained by Fitch's view of General Motors' credit profile, as the agency said it cannot envision a scenario where the captive would be rated higher than its parent. Rating constraints also include General Motors Financial's heavily secured funding profile, strong reliance on the asset-backed securitization market, which could become illiquid during times of unfavorable economic conditions, and the company's increased susceptibility to any dramatic weakening in the economy due to its focus on subprime customers, the agency said.

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