Buffett's Berkshire Hathaway Reduces Moody's Stake (Update1)

By Erik Holm
Bloomberg News
July 22, 2009

July 22 (Bloomberg) -- Warren Buffett's Berkshire Hathaway Inc. lowered its stake in Moody's Corp. by 17 percent after the billionaire chairman said he doesn't rely on the ratings firm in making investment decisions.

Buffett's firm sold about 8 million shares of the ratings firm on the open market this week, his Omaha, Nebraska-based company said today in a regulatory filing. Berkshire still holds about 40 million shares, or about 17 percent of the outstanding stock, the filing said.

"We do not think the people of Moody's, Standard & Poor's, Fitch or anyplace else should be telling us the credit rating of a company," Buffett said May 2 when Berkshire had its annual meeting. Buffett, who is also chief executive officer of Berkshire, said he still believes that assigning ratings to debt "is a good business."

The Obama administration yesterday proposed setting limits and disclosure requirements on credit-rating companies aimed at reducing conflicts of interest and providing more information about investment products. The overhaul follows accusations by investors and lawmakers including Senate Banking Committee Chairman Christopher Dodd that S&P, Moody's and Fitch Ratings gave AAA rankings to subprime-mortgage bonds just before that market collapsed.

Michael Adler, a spokesman for Moody's, declined to comment. Buffett didn't immediately return a message for comment left with his assistant Carrie Kizer.

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