Fitch lowers GM

Fitch Ratings said it said that recovery prospects appear low for General Motors Corp. bondholders, although according to the agency, ultimate recoveries remain highly uncertain, as unsecured creditors will receive equity in the new GM, the value of which will be driven largely by the success of restructuring efforts in the company's North American operations.

Fitch said it has downgraded the issuer default rating of General Motors to D from C following the company's Chapter 11 bankruptcy filing while the company's senior secured bank loans remain at CCC/RR1, indicating that full recovery is expected.

The company's senior unsecured debt is downgraded to C/RR6, indicating recoveries are expected to be in the range of 0%-10%, the agency said.

Current asset valuations are derived primarily from GM's Asian operations in Korea and China, as well as its Latin American operations, Fitch said, adding that it expects to re-rate the company upon emergence, although it is viewed as unlikely that the issuer default rating will be higher than CCC.

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