GE funding costs rise, but it can wait to access market

By Alex Radford
19 Aug 2019

General Electric’s bond spreads have widened substantially since last Thursday, when a research report by Harry Markopolos, the Bernie Madoff whistleblower, accused the US conglomerate of major fraud, by hiding $38bn of losses. However, the initial jolt has not turned into a rout, and while some bond investors see cause for concern, others are sceptical of Markopolos’ claims and do not expect the report to spell GE’s doom.

GE's share price fell as much as 13% on Thursday, before ending 11% down, after Markopolos released his report. It began to recover on Thursday and is now only 3.8% down.

GE is rated Baa1/BBB+/BBB+ with a negative outlook from Fitch. None of the rating agencies has commented yet ...

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