Bangkok--24 Feb--S&P Global Ratings
NEW YORK (S&P Global Ratings) Feb. 23, 2017--S&P Global Ratings has corrected its issue-level rating on Dillard's Capital Trust I's US$200 million 7.50% cap secs due 2038 by lowering it to 'BB' from 'BBB-'.
Due to an analytical error, we incorrectly raised the issue rating to 'BBB-' when we raised our corporate credit rating on Dillard's on March 17, 2015. According to our criteria, we should have raised the rating only two notches (to 'BB' instead of 'BBB-') because it is contractually subordinated and the instrument includes the right to defer interest payments. This approach is in accordance with our hybrid capital handbook criteria.
The correction does not have any impact on our corporate credit rating or outlook on parent Dillard's Inc. (BBB-/Negative/--), as we continue to treat the instrument as 100% debt for the purpose of calculating total adjusted debt.
For our latest analysis, please see the research update published May 20, 2016, on RatingsDirect.