Moody’s wary of JP Morgan loan

THE proposed acquisition of T-Mobile by AT&T could harm banking giant JPMorgan Chase, credit ratings agency Moody’s warned yesterday.

JPMorgan provided AT&T with a $20bn bridge loan to finance the T-Mobile deal, a move Moody’s said was a “credit negative.”

Moody’s says the loan threatens JPMorgan’s corporate debt because it reveals the bank’s willingness to finance risky deals in order to be named an adviser on the acquisition. Moody’s added that the “tail risk” was that the loan cannot be sold and becomes non-performing.

M&A: P11