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MF Global May Be Cut to Junk by Moody’s as Corzine Adds Risk

MF Global Holdings Ltd. had its credit ratings cut to the lowest investment grade by Moody’s Investors Service on concern that the broker run by former New Jersey governor Jon Corzine won’t meet earnings targets and isn’t sufficiently managing risk.

Moody’s lowered MF Global’s long-term ranking to Baa3 from Baa2 and left the New York-based company on review for a further downgrade, the ratings firm said today in a statement. The “current low interest environment and volatile capital market conditions” make it unlikely MF Global can achieve targets of $200 million to $300 million in annual pretax profit, Moody’s said. The broker changed the date it will report earnings to tomorrow.