Fitch Downgrades ResCap IDRs to 'Default'

The long- and short-term Issuer Default Ratings of Residential Capital LLC, Minneapolis, have been downgraded from C to D by Fitch Ratings following the company's recent distressed debt exchange. ResCap was also removed from Rating Watch Negative. Fitch said the downgrades indicate that a default has occurred under the rating agency's criteria on distressed debt exchanges. The exchange was necessary "to extend debt maturities and increase ResCap's financial flexibility," Fitch said. ResCap and its parent company, New York-based GMAC Financial Services, announced a $60 billion global refinancing June 4 in which, among other things, ResCap renewed "critical funding lines" and boosted its liquidity support from GMAC. Fitch can be found on the Web at http://www.fitchratings.com.