Moody's cuts WCI

Moody's Investors Service said it lowered WCI Communities, Inc.'s corporate family and probability-of-default ratings to B3 from B2 and its senior subordinated notes to Caa2 (LGD5, 83%) from Caa1.

The outlook is negative.

The downgrades and negative outlook reflect the company's challenges in complying with its bank covenants in 2007 and Moody's projections for negative earnings and significantly lower cash flow in 2007, the agency said.

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