General Electric Company -- Moody's: General Electric's higher dividend pay-out and share buy-back authorization has no impact on ratings

New York, December 14, 2012 -- Moody's Investors Service said that today's announcement by General Electric Company (GE, Aa3 stable) that it is raising its quarterly dividend by 12% and its share repurchase program authorization by $10 billion has no impact on the company's ratings. The increased dividend pay-out and share buy-back authorization are wholly consistent with GE management's guidance and Moody's prior expectations, according to the rating agency, and are predicated on the resumed, on-going upstream of dividends from finance subsidiary General Electric Capital Corp. (A1 stable) and expected cash flow growth within GE's industrial operations. "We expect that increased dividends and share repurchase activities will be executed within the bounds of increasing free cash flow, as expected, and not result in additional leveraging of the company's balance sheet, which would otherwise weigh on its currently strong credit profile," said Russell Solomon, Senior Vice President and lead analyst for GE. However, if buybacks and/or dividends (along with acquisitions) were to exceed the company's available cash and/or cash flows, or if liquidity considerations are adversely affected in any way, the ratings could come under pressure, particularly in light of GE's substantial $18.4 billion underfunded pension liability. For more information, please see the associated Issuer Comment for GE on www.moodys.com.

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