Meanwhile, Standard & Poor's Ratings Services has affirmed the ratings on Residential Capital, including its BBB-minus/A-3 counterparty credit rating, but the outlook has been revised from stable to negative."The outlook revision considers our concern regarding pressure on future general operating performance at the company," said S&P credit analyst John K. Bartko. "ResCap's recent actions have served to maintain adequate funding and liquidity; however, lower production levels, reduced margins from changes in asset mix to higher quality and hence lower-yielding assets, and the likely increased funding costs will combine to increase pressure on overall financial performance." ResCap has already reduced nonprime lending to "nominal levels," S&P said. "Clearly, these tactical/strategic reactions to the current marketplace will have negative consequences for ResCap in the near to intermediate term," the rating agency said.

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